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Kinnevik — Interim / Quarterly Report 2012
Oct 19, 2012
2935_rns_2012-10-19_5f529784-0704-443f-a75e-3d65c0c32e86.pdf
Interim / Quarterly Report
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Investment AB Kinnevik
Skeppsbron 18 P.O. Box 2094 SE-103 13 Stockholm Sweden www.kinnevik.se
(Publ) Reg no 556047-9742 Phone +46 8 562 000 00 Fax +46 8 20 37 74
INTERIM REPORT 1 JANUARY-30 SEPTEMBER 2012
Financial results for the third quarter
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Financial results for the first nine months of the year
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Kinnevik's net asset value 2007-2012
Pro forma adjusted for the acquisition of Emesco during Q3 2009. Figures in SEK m.
Market value - Listed Holdings
Figures in SEK m.
The figures in this report refer to the third quarter and first nine months of the year 2012 excluding discontinued operations unless otherwise stated. The figures shown within brackets refer to the comparable periods in 2011.
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Kinnevik was founded in 1936 and thus embodies seventyfive years of entrepreneurship under the same group of principal owners. Kinnevik's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy. Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
Total return
The Kinnevik share's average annual total return
| 29% |
|---|
| 3% |
| 11% |
1) Based on the assumption that shareholders have retained their allotment of shares in Tele2, MTG, Transcom and CDON
Events during the third quarter
- During the third quarter, Kinnevik invested a total of SEK 498m within Online, Microfinancing and Agriculture, of which SEK 351m in Rocket Internet's portfolio companies which means that approximately SEK 4.5bln had been invested within online, microfinancing, agriculture and renewable energy in the first nine months of the year.
- Kinnevik received a dividend from Rocket Internet amounting to SEK 294m in the quarter.
Events after the reporting period
- Millicom announced in October that the company proposes an extraordinary dividend of USD 3 per share to be decided at an EGM in the fourth quarter. This means that kinnevik will receive a dividend of USD 114m or around SEK 760m.
- Kinnevik will receive a dividend from Rocket Internet in the fourth quarter of around SEK 320m.
- On 18 October Kinnevik announced that it has acquired an additional 10% of common and preferred equity in Za- lando for a total consideration of EUR 287m. Sellers include the early stage-investors Holtzbrinck Ventures, Tengelmann and Rocket Internet that all sell a small portion of their stake while holding on to the major part of their shares. After the transaction, Kinnevik's ownership is 35% of which 26% is held directly and 9% indirectly via Rocket Internet
Kinnevik will finance the acquisition within existing credit facilities. Zalando has been valued in accordance with the value assigned in the transaction in Kinnevik's net asset value as per 30 September which, together with other changes in fair value of unlisted online holdings, has resulted in an increase in assessed fair value totalling SEK 2.1bln recognized in the consolidated income statement for the third quarter.
As part of the transaction, Kinnevik gets an option to acquire shares for an additional up to EUR 100m in Zalando, corresponding to 3% of the shares, at the same valuation from the same sellers. If Kinnevik receives a dividend from Rocket Internet as a result of their sale of Zalando shares, Kinnevik has committed to invest this dividend in Zalando shares as part of the EUR 100m.
Financial overview
The figures in this report refer to the third quarter and first nine months of the year 2012 excluding discontinued operations unless otherwise stated. The figures shown within brackets refer to the comparable periods in 2011. Metro is included in the Group's revenue and earnings from the second quarter 2012.
Consolidated earnings for the third quarter
The Group's total revenue during the third quarter amounted to SEK 410m, compared with SEK 85m in the preceding vear.
The Group's operating loss amounted to SEK 66m (loss of $(29)$
The change in fair value of financial assets including dividend received amounted to a profit of SEK 1,920m (loss of 1,323), of which a loss of SEK 165m (loss of 1,571) was related to listed holdings and a profit of SEK 2,085m (248) to unlisted financial assets (of which a profit of SEK 2,110m (profit of 125) related to Rocket Internet with portfolio companies).
Net profit amounted to SEK 1,805m (loss of 1,359), corresponding to a profit of SEK 6.51 (loss of 4.90) per share.
Consolidated earnings for the first nine months of the year
The Group's total revenue during the first nine months of the year amounted to SEK 1,061m, compared with SEK 233m in the preceding year.
The Group's operating loss amounted to SEK 88m (loss of $72$ ).
The change in fair value of financial assets, including dividends received, amounted to a loss of SEK 1.384m (profit) of 962), of which a loss of SEK $3,502m$ (profit of 741) was related to listed holdings and a profit of SEK 2,118m (221) to unlisted financial assets.
Net loss amounted to SEK 1.670m (profit of 845), corresponding to a loss of SEK 6.02 (profit of 3.05) per share.
The Group's cash flow and investments
The Group's cash flow from operations excluding change in working capital amounted to a negative SEK 98m (negative 27) during the first nine months of the year. Working capital increased by SEK 102m (19).
Investments made in tangible and biological and intangible fixed assets amounted to SEK 69m (12) during the period.
Financial overview
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| 1 Jan-30 Sept 2012 | Financial instrument | Amount (SEK m) |
|---|---|---|
| Subsidiaries | ||
| Metro | shares/warrants | 546 |
| Metro | debentures | 271 |
| Investment within Metro | shares | 9 |
| Investment within G3 Group | shares | 105 |
| 931 | ||
| Other securities | ||
| Online | ||
| Rocket Internet with portfolio companies |
shares/warrants | 4 153 |
| Avito | shares | 70 |
| Other Online investments | 41 | |
| Microfinancing | ||
| Bayport | shares | 116 |
| Seamless | shares | 16 |
| Other Microfinancing investments | 32 | |
| Agriculture | ||
| Black Earh Farming | shareholder's loan | 8 |
| 4 436 | ||
| 1 Jan-30 Sept 2011 | ||
| Subsidiaries | ||
| G3 Group | shares | 143 |
| Other subsidiaries | shares | 5 |
| 148 | ||
| Online | ||
| Avito | shares | 62 |
| Rocket Internet with portfolio companies |
shares/warrants | 1 629 |
| CDON | shares | 101 |
| Other Online investments | 82 | |
| Microfinancing | 10 | |
| 1 884 |
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| 1 Jan-30 Sept 2012 | Amount (SEK m) |
|
|---|---|---|
| Millicom | USD 2.40 per share | 656 |
| Tele2 | SEK 13 per share | 1 761 |
| MTG | SEK 9 per share | 122 |
| Rocket Internet | 294 | |
| Total dividends received | 2 833 | |
| Of which ordinary dividends | 1 659 |
1 Jan-30 Sept 2011
| Millicom | USD 1.80/share | 420 |
|---|---|---|
| Tele2 | SEK 6+21/share | 3 659 |
| MTG | SEK 7.50/share | 101 |
| Total dividends received | 4 180 | |
| Of which ordinary dividends | 1 334 |
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The Group's liquidity and financing
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Taxes
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Authorities in June orally informed Kinnevik that they still intend to challenge the tax treatment of the transaction. No further information has been exchanged between the parties during the third quarter and the date for a decision on the issue is still not known. If the Tax Authorities maintain their position and move forward with the issue against the company, Kinnevik will appeal the decision since the company is of the strong opinion that the Tax Authorities' interpretation of the law is incorrect. No provision has been made for the potential tax claim in the accounts.
Discontinued operations
On 20 June 2012, Kinnevik signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash and shares in consideration and will thereby become the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln in the transaction. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Lateran. In the transaction Korsnäs, including 5% of the shares in Bergvik Skog and 75% of the shares in Latgran Biofuels, is valued at approximately SEK 11bln on a debtfree basis.
As from end of June 2012, Kinnevik accounts for the profit and loss, assets and liabilities of Korsnäs, Bergvik Skog and Latgran as "discontinued operations, assets held for sale and liabilities directly associated with assets held for sale". The gain on the sale of Korsnäs has not yet been recognised in the accounts since completion of the transaction is subject to customary approvals from relevant competition authorities.
After closing of the merger between Korsnäs and Billerud, Kinnevik's net debt will be reduced by SEK 8.4bn (cash proceeds SEK 2.7bln and debt assigned to Korsnäs of SEK 5.7bln).
Business combination
On 6 February 2012 Kinnevik made a public offer for all shares and other financial instruments in Metro, which resulted in Kinnevik becoming the principal owner of Metro on 29 March owning 97.1% of the capital on a fully diluted basis. After further share purchases, Kinnevik owned 99.0% of the capital as per 30 September 2012. Kinnevik is consolidating Metro from 31 March 2012, which is the first date on which Metro prepared consolidated financial statements following the acquisition. The acquisition value for all of Metro including Kinnevik's earlier holdings, as well as noncontrolling interests has according to the acquisition assessment been calculated at SEK 1,419m including debentures of SEK 492m.
The provisional fair value of the identifiable assets and liabilities of Metro as at the date of acquisition was:
| Fair value recogni- sed on acquisition |
|
|---|---|
| Intangible fixed assets | 462 |
| Tangible and biological fixed assets | 44 |
| Financial assets accounted to fair value through profit and loss |
86 |
| Investments in companies accounted for using the equity method |
40 |
| Trade and other receivables | 482 |
| Cash and cash equivalents | 388 |
| Total assets | 1 502 |
| Equity attributable to non-controlling interest | $-17$ |
| Interest bearing-loans | $-546$ |
| Trade payables and other liabilities | $-484$ |
| Total liabilities | $-1047$ |
| Total identifiable net assets at fair value | 455 |
| Goodwill arising on acquisition | 472 |
| Purchase consideration for shares and warrants | 927 |
| Analysis of the purchase consideration: |
| Purchase consideration for shares and warrants | 927 |
|---|---|
| Fair value minority interest | 39 |
| Fair value previously held interest | 315 |
| Cash consideration | 573 |
Analysis of cash flow on acquisition:
| Net cash outflow | -185 |
|---|---|
| Cash paid for shares and warrants | $-573$ |
| Net cash acquired with the subsidiary | 388 |
From the date of acquisition, Metro has contributed SEK 797m of revenue and SEK 21m in operating profit to Kinnevik. If the business combination had taken place at the beginning of the year, the revenue from Metro would have been SEK 1,161m and the operating profit SEK 25m.
The transaction costs of approximately SEK 15m have been expensed and are included in the administrative expenses in the income statement and are part of operating cash flow in the statement of cash flow.
Book and fair value of assets
| 30 Sept 2012 | |||||||
|---|---|---|---|---|---|---|---|
| SEK million | Equity interest (%) |
Voting interest (%) |
Book value 2012 30 Sept |
Fair value 2012 30 Sept |
Fair value 2011 30 Sept |
Fair value 2011 31 Dec |
Total return 2012 |
| Telecom & services | |||||||
| Millicom | 38.0 | 38.0 | 23 061 | 23 061 | 25 898 | 26 088 | -9% |
| Tele2 | 30.5 | 47.7 | 16 124 | 16 124 | 17 059 | 18 129 | -1% |
| Transcom | 33.0 | 39.7 | 251 | 251 | 128 | 189 | 33% |
| Total Telecom and services | 39 436 | 39 436 | 43 085 | 44 406 | |||
| Online | |||||||
| Rocket Internet with portfolio companies | 7 298 | 7 298 | 1 724 | 4 376 | |||
| Zalando | 16 | 16 | 3 703 | 3 703 | 1 019 | 1 058 | |
| Groupon, directly owned shares | - | - | 450 | 1 197 | |||
| Avito (directly and through Vosvik) | 39 1) | 22 | 768 | 768 | 336 | 336 | |
| CDON | 25.1 | 25.1 | 681 | 681 | 419 | 629 | 8% |
| Other Online investments | 175 | 213 | 174 | 204 | |||
| Total Online | 12 625 | 12 663 | 4 122 | 7 800 | |||
| Media | |||||||
| MTG | 20.3 | 49.8 | 3 917 | 3 917 | 3 720 | 4 436 | -9% |
| Metro | 99 2) | 99 2) | 961 | 961 | 369 | 277 | |
| Metro subordinated debentures, interest bearing | - | - | 276 | 287 | |||
| Interest bearing net cash, Metro | 138 | 138 | - | - | |||
| Total Media | 5 016 | 5 016 | 4 365 | 5 000 | |||
| Paper & packaging | |||||||
| Korsnäs 4) | 100 | 100 | 8 295 | 11 000 3) | 10 593 3) | 10 449 3) | |
| Interest bearing net debt relating to Korsnäs | -5 724 | -5 724 | -5 112 | -5 212 | |||
| Total Paper & packaging | 2 571 | 5 276 | 5 481 | 5 237 | |||
| Microfinancing | |||||||
| Bayport | 43 2) | 43 2) | 573 | 573 | 380 | 405 | |
| Seamless | 12 2) | 12 2) | 51 | 51 | - | - | 214% |
| Other Microfinancing investments | 70 | 82 | 29 | 41 | |||
| Total Microfinancing | 694 | 706 | 409 | 446 | |||
| Agriculture and renewable energy | |||||||
| Black Earth Farming | 24.9 | 24.9 | 378 | 378 | 538 | 427 | -12% |
| Rolnyvik | 100 | 100 | 178 | 250 | 250 | 250 | |
| Vireo | 78 | 78 | 58 | 118 | 22 | 58 | |
| Total Agriculture and Renewable energy | 614 | 746 | 810 | 735 | |||
| Interest bearing net debt against listed holdings | -4 239 | -4 239 | -1 350 | -1 605 | |||
| Debt, unpaid investments | -122 | -122 | 0 | -490 | |||
| Other assets and liabilities | 317 | 317 | 267 | 310 | |||
| Total equity/net asset value | 56 912 | 59 799 | 57 189 | 61 839 | |||
| Net asset value per share | 215.74 | 206.32 | 223.10 | ||||
| Closing price, class B share | 136.30 | 127.50 | 133.80 | 6% |
1) After full dilution.
2) After warrants have been utilised.
3) As per September 2012, value assigned in transaction with Billerud, see further page 4. As per September and December 2011, consensus among analysts covering Kinnevik.
4) Including 5% of the shares in Bergvik Skog and 75% of the shares in Latgran Biofuels AB.
Kinnevik's holdings
Kinnevik's assets
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Kinnevik's business sectors
The figures shown within brackets refer to the comparable period previous year.
Telecom & Services
| Investment (SEK m) | Ownership | Estimated fair value |
|---|---|---|
| Millicom | 38.0% | 23 061 |
| Tele2 | 30.5% | 16 124 |
| Transcom | 33.0% | 251 |
| Total | 39 436 | |
| Return Telecom & Services | 1 year | 5 years |
|---|---|---|
| Average yearly internal rate of return (IRR) | -1% | 6% |
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| Proportional part of | Change compared to Jan-Sept 2011 |
|||
|---|---|---|---|---|
| Jan-Sept 2012 (SEK m) | revenue | EBIT | revenue | EBIT |
| Telecom & Services | 20 360 | 3 448 | 7% | -14% |
| Online | 3 450 | -841 | 126% | N/A |
| Media | 3 199 | 368 | 1% | -14% |
| Paper & Packaging | 6 797 | 785 | 5% | -3% |
| Microfinancing | 248 | 86 | 22% | 48% |
| Agriculture and Renewable energy | 195 | -21 | 87% | N/A |
| Total sum of Kinnevik's proportional part | ||||
| of revenue and operating result | 34 249 | 3 825 | 12% | -26% |
Kinnevik's proportional part of revenue and operating result in its holdings
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Kinnevik's holdings
Millicom
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| Key data (USD m) | 2012 | 2011 | 2012 | 2011 |
| Revenue | 3548 | 3352 | 1 199 | 1 151 |
| EBITDAsup> | 1 537 | 1 551 | 507 | 529 |
| Operating profit, EBIT | 838 | 924 | 264 | 320 |
| Net profit | 421 | 744 | 114 | 345 |
| Number of mobile subscribers (million) | 46.0 | 42.2 |
Millicom's underlying revenue in local currency grew by 8.4% during the third quarter 2012 and 8.5% for the first nine months. The third quarter was similar to the previous two quarters where sustained investments for future growth diluted the EBITDA margin while maintaining a high organic revenue growth.
In Latin America, revenue grew in the third quarter by 9% in local currency, despite continued pricing pressure in El Salvador and a decline in international incoming revenue in Guatemala. In South America growth rebounded due to the voice-to-data transition. In Africa, top line growth in local currency accelerated somewhat at close to 7% in O3.
The information category continues to be the strongest contributor to growth, representing more than half of the underlying revenue growth in local currency. By the end of September 2012, over 16% of the Latin American subscribers where users of mobile data services.
During the third quarter, Millicom invested in online services and e-commerce businesses by acquiring stakes in Rocket Internet businesses in both Latin America and Africa. The investment is in line with the Millicom's aim to strengthen innovation and seize new growth opportunities and broadens the company's innovation capability into the Online sector.
The Board will propose to an EGM an extraordinary dividend of USD 3.00 per share which will bring Millicom's total shareholder return for the year to close to USD 735m.
Tele2e & Renewable energy
| Investment (SEK m) | Ownership | Invested
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| Key data (SEK m) | 2012 | 2011 | 2011 | 2011 |
| Revenue | 32 451 | 30 149 | 10 906 | 10 429 |
| FBITDA Poland | 100% | 174 | 250 | |
| Vireo Energy | 78% | 118 | 118 | |
| Total | 959 | 746 |
| Return Agriculture & Renewable energy | 1 year | 5 years |
|---|---|---|
| Average yearly internal rate of return (IRR) | -27% | -14% |
,JOOFWJLTGPDVTXJUIJO"HSJDVMUVSFJTUPDPOUJOVFEFWFMP-QJOHUIFBSFBTUIBUIBWFCFFOBDRVJSFEBUSFMBUJWFMZMPXQSJ-DFTJOMFTTEFWFMPQFEBSFBTJO1PMBOEBOE3VTTJBUPBDIJFWF IJHIFSQSPEVDUJWJUZBOESFUVSO
8JUIJO3FOFXBCMFFOFSHZ
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Black Earth Farming
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| Jan-July | |||||
|---|---|---|---|---|---|
| Key data (USD m) | 2012 | 2011 | 2011 | ||
| Revenue | 46.5 | 17.6 | 77.6 | ||
| Operating loss, EBIT | -4.1 | -8.2 | -25.2 | ||
| Net loss | -13.3 | -13.2 | -41.7 |
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Rolnyvik
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Vireo Energy
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Parent Company and other
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development |
8 2 8 8 | 8 339 | 3 0 0 2 | 2986 | ||
| Operating profit, EBIT | 4 1 2 9 | 5 387 | 1 317 | 1977 | ||
| Net profit | 2699 | 3593 | 980 | 1 2 5 9 | ||
| Number of subscribers (million) | 37.7 | 33.5 |
Net sales in the third quarter, excluding exchange rate differences, increased by 9%. Tele2's mobile services now accounts for almost 80% of total revenue. EBITDA margin rebounded to 28%.
Tele2 Sweden contributed with record high EBITDA of SEK 828 million, representing an EBIT margin of 33% and mobile revenue grew by 4% as a result of a continued customer demand for smartphones and data services. Tele2 Norway performed well as network capabilities improved and EBITDA margin developed despite lowered interconnect rate.
Russia is Tele2's most significant growth engine and the
company has GSM licenses in 43 regions. The competitive landscape was more balanced during the third quarter and Tele2's Russian customer base grew by 710,000 (681,000) during the period. The total customer base amounted to 22.3 (20.4) million. Tele2 continues to hold a close dialogue with the Russian regulatory authorities on the issue of technology neutrality.
In September, Tele2 reached the milestone of 3 million customers in Kazakhstan, well ahead of plan. Customer intake amounted to 589,000 (459,000). Tele2 continues with network expansion in Kazakhstan to have a geographical coverage comparable to that of its competitors by the end of the year.
Tele2 Netherlands customer base grew during the quarter driven by high mobile intake. Though revenue declined slightly due to seasonality effects, the EBITDA margin and cash flow performance showed steady performance.
Transcom
| 11 un vvvnn | Jan-Sept | July-Sept | ||
|---|---|---|---|---|
| Key data (EUR m) | 2012 | 2011 | 2011 | 2011 |
| Revenue | 4427 | 411.1 | 148.2 | 132.7 |
| Operating profit/loss, EBIT | 3.7 | $-30.1$ | 11 | -5.8 |
| Net profit/loss | $-5.5$ | $-48.9$ | $-3.5$ | $-22.9$ |
Transcom revenue grew by 11.7% in the third quarter, mainly driven by organic growth through increased number of clients and high volumes with the installed client base. Although revenue decreased within the Credit Management Services (CMS) business, all regions delivered growth.
EBITA was EUR 2.2m (-4.8) impacted by significant expansion costs during the quarter, primarily in the Philippines.
Transcom will continue to align its cost base to current business conditions and restructure the corporate organization to reduce overhead cost.
Kinnevik's holdings
Online
| Investment (SEK m) | OwnershipUIFmSTUOJOFNPOUITPGUIFZFBS"TJOQSFWJPVTZFBST BMBSHFQPSUJPOPGMBTUZFBSTIBSWFTUXBTTUPSFEBOEXFSF TPMEEVSJOHUIFmSTUIBMGPG
Vireo Energy
*O
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PXOJOHBOEPQFSBUJOHGBDJMJUJFTUIBUQSPEVDF FOFSHZGSPNSFOFXBCMFTPVSDFT*OJUJBMMZ
UIFDPNQBOZJT GPDVTJOHQSJNBSJMZPOQSPKFDUTUPSFDPWFSFOFSHZGSPNMBOEmMMHBT
BOEPUIFSGPSNTPGXBTUFCBTFECJPHBT(FPHSBQIJD GPDVTJT1PMBOEBOEBEKBDFOUDPVOUSJFT\$POUSBDUTIBWFCFFO TJHOFEGPSUIFSFDPWFSZPGCJPHBTXJUIBOVNCFSPGMBOEmMMT JO1PMBOEBOE#FMBSVT7JSFPJTOPXJOWFTUJOHJOUIFTFGBDJ-MJUJFTBOEJTDPNNFODJOHUIFTBMFPGFOFSHZ
Parent Company and other
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development |
Net investedZFBS"TJOQSFWJPVTZFBST BMBSHFQPSUJPOPGMBTUZFBSTIBSWFTUXBTTUPSFEBOEXFSF TPMEEVSJOHUIFmSTUIBMGPG |
Vireo Energy
*O
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PXOJOHBOEPQFSBUJOHGBDJMJUJFTUIBUQSPEVDF FOFSHZGSPNSFOFXBCMFTPVSDFT*OJUJBMMZ
UIFDPNQBOZJT GPDVTJOHQSJNBSJMZPOQSPKFDUTUPSFDPWFSFOFSHZGSPNMBOEmMMHBT
BOEPUIFSGPSNTPGXBTUFCBTFECJPHBT(FPHSBQIJD GPDVTJT1PMBOEBOEBEKBDFOUDPVOUSJFT\$POUSBDUTIBWFCFFO TJHOFEGPSUIFSFDPWFSZPGCJPHBTXJUIBOVNCFSPGMBOEmMMT JO1PMBOEBOE#FMBSVT7JSFPJTOPXJOWFTUJOHJOUIFTFGBDJ-MJUJFTBOEJTDPNNFODJOHUIFTBMFPGFOFSHZ
Parent Company and other
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development amount |
Estimated fair value |
|||||
| ------------------------------------------------------- | ------------------ | ------------------------------- | ------------------------- | |||
| CDON | 25.1% | $517^{11}$ | 681 | |||
| Unlisted online investments | ||||||
| Zalando | 16% | 2 197 | 3 703 | |||
| Bigfoot I (Dafiti, Lamoda, Namshi) |
33% | 1 536 | 1448 | |||
| Bigfoot II (The Iconic, Zalora, Zando) |
34% | 760 | 595 | |||
| Rocket Internet GmbH and other portfolio companies |
mixed | 2 7 7 8 | 5 255 | |||
| Avito (directly and through Vosvik) |
39% | 356 | 768 | |||
| Other | mixed | 576 | 213 | |||
| Total unlisted online investmentsUTUPSFDPWFSFOFSHZGSPNMBOEmMMHBT | ||||||
| BOEPUIFSGPSNTPGXBTUFCBTFECJPHBT(FPHSBQIJD GPDVTJT1PMBOEBOEBEKBDFOUDPVOUSJFT\$POUSBDUTIBWFCFFO TJHOFEGPSUIFSFDPWFSZPGCJPHBTXJUIBOVNCFSPGMBOEmMMT JO1PMBOEBOE#FMBSVT7JSFPJTOPXJOWFTUJOHJOUIFTFGBDJ-MJUJFTBOEJTDPNNFODJOHUIFTBMFPGFOFSHZ |
Parent Company and other
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development |
8 2 0 3 | 11 982 | ||||
| Total online investmentsBT(FPHSBQIJD GPDVTJT1PMBOEBOEBEKBDFOUDPVOUSJFT\$POUSBDUTIBWFCFFO TJHOFEGPSUIFSFDPWFSZPGCJPHBTXJUIBOVNCFSPGMBOEmMMT JO1PMBOEBOE#FMBSVT7JSFPJTOPXJOWFTUJOHJOUIFTFGBDJ-MJUJFTBOEJTDPNNFODJOHUIFTBMFPGFOFSHZ |
Parent Company and other
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development |
8720 | 12 663 |
1)rent Company and other**
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development The value of dividend received from MTG when shares distributed and share purchases made thereafter. |
| Return Online | 1 vear | 5 years |
|---|---|---|
| Average yearly internal rate of return (IRR) | 66% | 40% |
Online services are growing strongly and Kinnevik is searching investments that will benefit from households spending a growing proportion of their time and budget online. The main focus is consumer-oriented services, with proven business concepts. A majority of the funds invested have gone into various e-commerce models.
CDON
CDON Group is a leading e-commerce company with some of the most well known and appreciated brands in the Nordic area
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| Key data (SEK m) | 2012 | 2011 | 2012 | 2011 |
| Revenue | 2889 | 2087 | 982 | 826 |
| Operating profit/loss, EBIT | $-63.2$ | 579 | $-7.6$ | 18.7 |
| Net profit/loss | $-61.4$ | 34.6 | $-11.3$ | 11.5 |
CDON continues to show strong revenue growth with a record net sales increase of 19% year-on-year in the third quarter and 38% growth the first nine months.
During the quarter, CDON launched a Sport & Leisure category as well as tretti.se's assortment of white goods, household appliances and outdoor products on CDON. com. The launch broadens CDON.com's assortment and strengthens its position as the leading online shopping mall in the Nordic region.
On 1 October, CDON acquired the group's logistical operations in Falkenberg, Sweden. The acquisition is an important step towards strengthening the group's value chain and delivering a high level of customer satisfaction.
CDON's online stores had 53.3 (41.3) million visits and generated 1.6 (1.4) million orders during the third quarter, and $166.5$ (111.0) million visits and $4.6$ (3.8) orders year to date.
Unlisted online holdings
Kinnevik's proportional part of the unlisted companies' revenue grew by 173% year-on-year and reached SEK 2,727m for the first nine months of the year. Revenue growth is strongest in the second and fourth quarter which is explained by the seasonal variations in the shoes and fashion industry. Due to the strong growth and short operating history, the unlisted companies within Kinnevik's online portfolio are still unprofitable. Losses have continued to increase during 2012 as a result of the geographic expansion and launch of new businesses. However, the larger companies in the portfolio are well capitalised and can afford continued investments until they reach break-even.
Kinnevik's proportional part of revenue within its unlisted online holdings
| | 01 2011 | 02 2011 | 03 2011 | 04 2011 | FY 2011tina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development |
01 2012 | 02 2012 | 03 2012 | 2012 YTDe consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family. |
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development |
||||||
| ---------------------- | --------- | --------- | --------- | --------- | ---------------- | --------- |
| Revenue | 263 | 346 | 391 | 614 | 1613 | 724 |
| Q on Q growth | 32% | 13% | 57% | 18% | ||
| Y on Y growth | 176% | |||||
| Acc. invested amount |
The table above is a compilation of the unlisted online holdings' reported revenue multiplied by Kinnevik's ownership share at the end of the reporting period, thereby showing Kinnevik's proportional share of the companies' revenues. Constant exchange rates (average rate for 2012) have been used when translating revenue from each company's reporting currency into Swedish kronor. For companies that have not yet reported the September figures, revenue is included with one month's delay. The proportional share of revenue has no connection with Kinnevik's accounting and is only additional information.
Kinnevik's holdings
Investments and valuation
In the first nine months of 2012, Kinnevik invested SEK 4,290m within Online, of which SEK 4,153m in Rocket Internet with portfolio companies and SEK 70m in Avito. Out of the funds invested into Rocket Internet with portfolio companies, a majority were invested into the shoes and fashion e-commerce companies Zalando, Dafiti, Lamoda and Namshi, as well as payment for exercising warrants in Rocket Internet.
At the end of September, unlisted investments in Online (i.e. excluding CDON) were valued at a total of SEK 11,982m. The assessed change in fair value recognized in the consolidated income statement and dividends received amounted to a profit of SEK 2,063m (profit of 165) for the first nine months of the year, of which a profit of SEK 1,708m (profit of 164) related to the change of fair value in Rocket Internet with portfolio companies and a profit of SEK 362m (0) related to Avito. The positive change related to Rocket Internet with portfolio companies is due to positive revaluation of Zalando, Dafiti, Lamoda and Namshi, which has been offset against declining stock-market price of Rocket's shares in Groupon and negative exchange rate effects.
For the third quarter, the assessed change in fair value recognized in the consolidated income statement and dividends received amounted to a profit of SEK 2,077m (profit of 167), of which a profit of SEK 2,110m (profit of 125) related to Rocket Internet with portfolio companies and a loss of SEK 6m (0) related to Avito.
In the valuation of Kinnevik's investment in Rocket Internet, all its portfolio companies with the exception of Zalando, Dafiti, Lamoda, Namshi and Groupon have been valued at cost, which is considered to correspond to fair value. Zalando has been valued at EUR 2.8 bn (100% equity value), which is in line with the value at which Kinnevik in October 2012 has acquired another 10% of the company's shares for, and also in line with the valuation in Zalando's latest financing round which took place earlier this year where Kinnevik participated (se further Events after the end of the reporting period, page 2). Rocket's shares in Groupon have been valued at current stock-market price at the end of the reporting period and the other Rocket companies not valued at cost, and Avito, are recognized at the assessed fair value by applying a multiple to the company's historic sales. The multiple was determined based on a comparison with a group of comparable companies.
During 2011 and first nine months of 2012, a number of Rocket's portfolio companies as well as Avito, have issued new shares to external investors at price levels that exceeds Kinnevik's recognized assessed fair values. Since the newly issued shares have better preference over the portfolio companies' assets in the event of liquidation or sale than Kinnevik's shares have, Kinnevik do not consider these price levels as a relevant base for assessing the fair values in the accounts. The latest transactions that have
been made with better preference than Kinnevik's shareholdings, have been made at levels that, applied on Kinnevik's shareholdings, is above SEK 5 bln higher than Kinnevik's book value as per 30 September 2012.
Rocket Internet
Rocket Internet is a company that incubates and develops e-commerce and other consumer-oriented online companies. Kinnevik owns 25% of Rocket Internet following the exercise of warrants during the first quarter of 2012.
Kinnevik works closely with the founders of Rocket Internet in order to start up companies and develop them into leading Internet players. During the past year a number of companies have been established in emerging markets where Rocket Internet's online expertise can be combined with Kinnevik's experience and network.
Besides the 25% investment into Rocket Internet, Kinnevik has also invested directly into a number of companies founded by Rocket Internet in the following segments:
- E-commerce of shoes and fashion, with Zalando in Europe; Dafiti in Brazil, Argentina, Chile and Mexico; Lamoda in Russia; Namshi in Middle East; The Iconic in Australia; Zalora in South East Asia; Zando in South Africa as well as other newly started companies in other emerging markets
- E-commerce of furniture and home décor, with Home24 and Westwing in Europe and a number of other companies that have been started in emerging markets.
- E-commerce of general retail and sports goods with Kanui in Brazil, Lazada in South-East Asia, Linio in Latin America and a number of other companies that have been started in other emerging markets.
- · Marketplaces for brokering short-term housing through the companies Wimdu and Airizu and place for food ordering through Foodpanda.
Zalando
Zalando started its operations in Germany in 2008 and today operates online shops also in the Netherlands, Belgium, France, the United Kingdom, Austria, Switzerland, Italy, Spain, Sweden, Finland, Norway, Denmark and Poland. Zalando has grown rapidly and is today the largest online player in the fashion sector in Europe. In 2011, Zalando launched its own logistic center and opened the first warehouse operated by the company. A second warehouse has been constructed in the city of Erfurt in Germany which successfully started to operate in the third quarter of 2012.
Zalando continues to grow strongly. The company reported net sales of EUR 510m in 2011 and EUR 471m in the first six months of 2012. Due to the strong growth and geographical expansion, the company reported an operating loss. In its more mature markets, including Germany, Austria and Switzerland, the company has demonstrated
Kinnevik's holdings
strong margin improvement whilst continuing to invest in growth. In the past year Zalando has raised capital from DST, JP Morgan and Kinnevik among other investors and the company is well capitalised to fund its planned future growth.
Avito
Avito is the leading online service for classified advertising in Russia. In the third quarter, the company had an average of 4.5 million new listings per month (2.3 million for the corresponding period last year) and 22.3 million (13.5) unique monthly visitors. The company has during the third quarter continued to invest to further strengthen its leading position. Revenues primarily derive from advertising sales on the website and from value-added services.
During the second quarter, Avito made a new share issue to existing as well as new owners. Out of a total of USD 75m in new financing, Kinnevik contributed with USD 10m at a pre-money valuation of USD 300m for the entire company. After the new issue of shares, Kinnevik owns, directly as well as indirectly through Vosvik AB, 39% of the capital in Avito after dilution from outstanding warrants.
Media
| Investment (SEK m) | Ownership | | Estimated fair value | 171 | 31 | 98 |
| Selling, administration, research and development
|
|----------------------------------------------|-----------|--------|-----------------------------|
| Modern Times Group | 20.3% | | 3917 |
| Metro | 99%1) | | 1099 |
| Totalg profit/loss | | -88 | -72 | -66 | -29 | -125 |
| Dividends received | 2 | 2 833 | 4 180 | 294 | 0 | 4 947 |
| Change in fair value of financial assets | 2 | -4 217 | -3 218 | 1 626 | -1 323 | 1 074 |
| Interest income and other financial income | | 35 | 48 | 8 | 11 | 67 |
| Interest expenses and other financial expenses | | -189 | -122 | -53 | -32 | -168 |
| Profit/loss after financial items | | -1 626 | 816 | 1 809 | -1 373 | 5 795 |
| Taxes | | -44 | 29 | -4 | 14 | 58 |
| NET PROFIT/LOSS FROM CONTINUING OPERATIONS | | -1 670 | 845 | 1 805 | -1 359 | 5 853 |
| Net profit from discontinued operations | 4 | 518 | 574 | 203 | 239 | 702 |
| Net profit/ loss for the period | | -1 152 | 1 419 | 2 008 | -1 120 | 6 555 |
| Of which attributable to: | | | | | | |
| Equity holders of the Parent Company | | | | | | |
| Net profit/loss from continuing operations | | -1 662 | 848 | 1 813 | -1 359 | 5 857 |
| Net profit/loss from discontinued operations | | 510 | 569 | 202 | 239 | 696 |
| Non-controlling interest | | | | | | |
| Net profit/loss from continuing operations | | -9 | -3 | -9 | 0 | -4 |
| Net profit/loss from discontinued operations | | 8 | 5 | 1 | 0 | 6 |
| Earnings per share | | | | | | |
| Earnings per share before dilution, SEK | | -4.16 | 5.11 | 7.27 | -4.04 | 23.64 |
| Earnings per share after dilution, SEK | | -4.16 | 5.11 | 7.27 | -4.04 | 23.62 |
| From continuing operations: | | | | | | |
| Earnings per share before dilution, SEK | | -6.02 | 3.05 | 6.51 | -4.90 | 21.12 |
| Earnings per share after dilution, SEK | | -6.02 | 3.05 | 6.51 | -4.90 | 21.10 |
| Average number of shares before dilution | | 277 183 276 | 277 170 733 | 277 183 276 | 277 166 552 | 277 173 242 |
| Average number of shares after dilution | | 277 474 307 | 277 375 189 | 277 483 975 | 277 365 154 | 277 396 143 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (SEK m)
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Net profit/loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | 6 555 |
| Other comprehensive income for the period | |||||
| Translation differences | -63 | 7 | -50 | -2 | -3 |
| Cash flow hedging | 5 | -79 | 4 | -5 | -82 |
| Actuarial profit/loss | 0 | 0 | 0 | 62 | -14 |
| Tax attributable to other comprehensive income | -1 | 21 | -1 | -15 | 25 |
| Total other comprehensive income for the period | -59 | -51 | -47 | 40 | -74 |
| Total comprehensive income for the period | -1 211 | 1 368 | 1 961 | -1 080 | 6 481 |
| Total comprehensive income for the period |
5016 | ||||
| 1)ds received | 2 | 2 833 | 4 180 | 294 | 0 |
| Change in fair value of financial assets | 2 | -4 217 | -3 218 | 1 626 | -1 323 |
| Interest income and other financial income | 35 | 48 | 8 | 11 | |
| Interest expenses and other financial expenses | -189 | -122 | -53 | -32 | |
| Profit/loss after financial items | -1 626 | 816 | 1 809 | -1 373 | |
| Taxes | -44 | 29 | -4 | 14 | |
| NET PROFIT/LOSS FROM CONTINUING OPERATIONS | -1 670 | 845 | 1 805 | -1 359 | |
| Net profit from discontinued operations | 4 | 518 | 574 | 203 | 239 |
| Net profit/ loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | |
| Of which attributable to: | |||||
| Equity holders of the Parent Company | |||||
| Net profit/loss from continuing operations | -1 662 | 848 | 1 813 | -1 359 | |
| Net profit/loss from discontinued operations | 510 | 569 | 202 | 239 | |
| Non-controlling interest | |||||
| Net profit/loss from continuing operations | -9 | -3 | -9 | 0 | |
| Net profit/loss from discontinued operations | 8 | 5 | 1 | 0 | |
| Earnings per share | |||||
| Earnings per share before dilution, SEK | -4.16 | 5.11 | 7.27 | -4.04 | |
| Earnings per share after dilution, SEK | -4.16 | 5.11 | 7.27 | -4.04 | |
| From continuing operations: | |||||
| Earnings per share before dilution, SEK | -6.02 | 3.05 | 6.51 | -4.90 | |
| Earnings per share after dilution, SEK | -6.02 | 3.05 | 6.51 | -4.90 | |
| Average number of shares before dilution | 277 183 276 | 277 170 733 | 277 183 276 | 277 166 552 | |
| Average number of shares after dilution | 277 474 307 | 277 375 189 | 277 483 975 | 277 365 154 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (SEK m)
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Net profit/loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | 6 555 |
| Other comprehensive income for the period | |||||
| Translation differences | -63 | 7 | -50 | -2 | -3 |
| Cash flow hedging | 5 | -79 | 4 | -5 | -82 |
| Actuarial profit/loss | 0 | 0 | 0 | 62 | -14 |
| Tax attributable to other comprehensive income | -1 | 21 | -1 | -15 | 25 |
| Total other comprehensive income for the period | -59 | -51 | -47 | 40 | -74 |
| Total comprehensive income for the period | -1 211 | 1 368 | 1 961 | -1 080 | 6 481 |
| Total comprehensive income for the period Fully diluted. |
|||||
| Return Mediavalue of financial assets | 2 | -4 217 | -3 218 | 1 626 | -1 323 |
| Interest income and other financial income | 35 | 48 | 8 | 11 | |
| Interest expenses and other financial expenses | -189 | -122 | -53 | -32 | |
| Profit/loss after financial items | -1 626 | 816 | 1 809 | -1 373 | |
| Taxes | -44 | 29 | -4 | 14 | |
| NET PROFIT/LOSS FROM CONTINUING OPERATIONS | -1 670 | 845 | 1 805 | -1 359 | |
| Net profit from discontinued operations | 4 | 518 | 574 | 203 | 239 |
| Net profit/ loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | |
| Of which attributable to: | |||||
| Equity holders of the Parent Company | |||||
| Net profit/loss from continuing operations | -1 662 | 848 | 1 813 | -1 359 | |
| Net profit/loss from discontinued operations | 510 | 569 | 202 | 239 | |
| Non-controlling interest | |||||
| Net profit/loss from continuing operations | -9 | -3 | -9 | 0 | |
| Net profit/loss from discontinued operations | 8 | 5 | 1 | 0 | |
| Earnings per share | |||||
| Earnings per share before dilution, SEK | -4.16 | 5.11 | 7.27 | -4.04 | |
| Earnings per share after dilution, SEK | -4.16 | 5.11 | 7.27 | -4.04 | |
| From continuing operations: | |||||
| Earnings per share before dilution, SEK | -6.02 | 3.05 | 6.51 | -4.90 | |
| Earnings per share after dilution, SEK | -6.02 | 3.05 | 6.51 | -4.90 | |
| Average number of shares before dilution | 277 183 276 | 277 170 733 | 277 183 276 | 277 166 552 | |
| Average number of shares after dilution | 277 474 307 | 277 375 189 | 277 483 975 | 277 365 154 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (SEK m)
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Net profit/loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | 6 555 |
| Other comprehensive income for the period | |||||
| Translation differences | -63 | 7 | -50 | -2 | -3 |
| Cash flow hedging | 5 | -79 | 4 | -5 | -82 |
| Actuarial profit/loss | 0 | 0 | 0 | 62 | -14 |
| Tax attributable to other comprehensive income | -1 | 21 | -1 | -15 | 25 |
| Total other comprehensive income for the period | -59 | -51 | -47 | 40 | -74 |
| Total comprehensive income for the period | -1 211 | 1 368 | 1 961 | -1 080 | 6 481 |
| Total comprehensive income for the period |
1 year | 5 years | |||
| Average yearly internal rate of return (IRR) | 2% | $-7%$ |
The Kinnevik media companies have strong market positions and brands with operations in a total of 41 markets and a combined reach of 125 million daily TV viewers in MTG and 18 million daily readers in Metro covering Scandinavia, Eastern Europe, Africa and Latin America.
Modern Times Group MTG
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| Key data (SEK m) | 2012 | 2011 | 2012 | 2011 |
| Revenue | 9 7 1 6 | 9 7 6 2 | 2 940 | 3 106 |
| Operating profit/loss, EBIT | 1648 | 1900 | 422 | 526 |
| Net profit/loss | 1 216 | 1 276 | 308 | 306 |
MTG reported a decrease of 5% in revenues during the third quarter, related to deterioration in the Danish advertising market and lower market shares in Sweden and Norway. On a year to year basis, the revenues were stable.
During the quarter, MTG has launched several new channels in both the Nordic region and its Emerging markes. Ratings in Scandinavia has picked up or stabilized as the company continues to invest in strengthening its content offerings, especially in the Nordic region where competition is fierce.
MTG has grown its audience and advertising market shares in almost all of the emerging market territories. In addition, further investments in the development of online pay-tv services Viaplay continues. The additional operating expenses are driving down the EBIT result for the period.
On 14 September, MTG announced that the company has been included in the Dow Jones Sustainability World Index for the first time, as a result of a 14% year to year improvement in the Groups Corporate Sustainability Assessment score.
Metro
After the public offer has now been successfully completed, it is Kinnevik's intention to continue Metro's operations in accordance with the strategic plan that has been developed by the management of Metro and continue to invest in emerging markets. This strategy entail a balance between cost savings in the free newspaper business while at the same time investing in emerging markets and in the online business.
Readership and Advertising Market
Metro is published in over 100 major cities in 22 countries across Europe, Asia, North and South America. Metro's global readership has increased by 8% year-on-year to approximately 18.5 million daily readers. Launch of new editions in Brazil and Mexico, and expansion in Colombia are the main reasons for the increase.
In Sweden, Metro consolidated its position and it is by far the most read newspaper in the country and the most read newspaper in Stockholm.
ZenithOptimedia (March 2012) is forecasting global advertising expenditure to grow by 4.8% in 2012. Newspapers advertising expenditure is expected to decline by 1.8% in 2012 in Western Europe and to increase by 8.2% in Latin America.
Operations
The table below gives the details on operational results:
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| EUR m | 2012 | 2011 | 2012 | 2011 |
| Revenue | ||||
| Europe | 80.5 | 86.7 | 19.6 | 23.8 |
| Emerging Markets | 2012 | 2011 | 2012 | 2011 |
| ------------------------------------------------------------ | ------------------ | ------------------ | ------------------- | ------------------- |
| Note | 1 Jan |
56.3 | 48.5 | 20.6 |
| Head Quarters | 2012 | 2011 | 2012 | 2011 |
| ------------------------------------------------------------ | ------------------ | ------------------ | ------------------- | ------------------- |
| Note | 1 Jan |
5.1 | 3.6 | 1.5 |
| Total | 141.9 | 138.8 | 41.7 | 42.0 |
| Operating profit, EBIT | ||||
| Operating profit | -79 | -62 | -63 | -26 |
| Adjustment for non-cash items | 58 | 42 | 34 | 22 |
| Taxes paid | -77 | -6 | -34 | -8 |
| Cash flow from operations before change in working capital | -98 | -27 | -63 | -12 |
| Change in working capital | -102 | -19 | -94 | -22 |
| Cash flow from operations | -200 | -46 | -157 | -34 |
| Acquisition of subsidiaries | -527 | -148 | -53 | - |
| Sale of subsidiary | 98 | - | 98 | - |
| Investments in tangible and biological fixed assets | -58 | -8 | -26 | -8 |
| Sales of tangible and biological fixed assets | 0 | 0 | 0 | 6 |
| Investments in intangible fixed assets | -11 | -4 | -11 | -4 |
| Investments in shares and other securities | -4 806 | -1 884 | -508 | -1 373 |
| Sales of shares and other securities | 569 | 28 | 0 | 28 |
| Dividends received | 2 833 | 4 180 | 294 | 0 |
| Changes in loan receivables | 210 | 9 | 144 | 0 |
| Interest received | 25 | 7 | 22 | 2 |
| Cash flow from investing activities | -1 667 | 2 180 | -40 | -1 350 |
| Change in interest-bearing liabilities | 2 739 | -575 | -617 | 1 440 |
| Interest paid | -140 | -73 | -37 | -19 |
| Contribution from holders of non-controlling interest | 15 | - | 15 | - |
| Dividend paid to equity holders of the Parent company | -1 524 | -1 247 | - | - |
| Dividend paid to holders of non-controlling interest | - | - | - | - |
| Cash flow from financing activities | 1 090 | -1 895 | -639 | 1 421 |
| CASH FLOW FOR THE PERIOD FROM CONTINUING OPERA | ||||
| TIONS | -777 | 239 | -836 | 38 |
| Cash flow for the period from discontinued operations |
||||
| Europe | 5.4 | 9.3 | $-0.4$ | 1.0 |
| Emerging Marketscash items | 58 | 42 | 34 | 22 |
| Taxes paid | -77 | -6 | -34 | -8 |
| Cash flow from operations before change in working capital | -98 | -27 | -63 | -12 |
| Change in working capital | -102 | -19 | -94 | -22 |
| Cash flow from operations | -200 | -46 | -157 | -34 |
| Acquisition of subsidiaries | -527 | -148 | -53 | - |
| Sale of subsidiary | 98 | - | 98 | - |
| Investments in tangible and biological fixed assets | -58 | -8 | -26 | -8 |
| Sales of tangible and biological fixed assets | 0 | 0 | 0 | 6 |
| Investments in intangible fixed assets | -11 | -4 | -11 | -4 |
| Investments in shares and other securities | -4 806 | -1 884 | -508 | -1 373 |
| Sales of shares and other securities | 569 | 28 | 0 | 28 |
| Dividends received | 2 833 | 4 180 | 294 | 0 |
| Changes in loan receivables | 210 | 9 | 144 | 0 |
| Interest received | 25 | 7 | 22 | 2 |
| Cash flow from investing activities | -1 667 | 2 180 | -40 | -1 350 |
| Change in interest-bearing liabilities | 2 739 | -575 | -617 | 1 440 |
| Interest paid | -140 | -73 | -37 | -19 |
| Contribution from holders of non-controlling interest | 15 | - | 15 | - |
| Dividend paid to equity holders of the Parent company | -1 524 | -1 247 | - | - |
| Dividend paid to holders of non-controlling interest | - | - | - | - |
| Cash flow from financing activities | 1 090 | -1 895 | -639 | 1 421 |
| CASH FLOW FOR THE PERIOD FROM CONTINUING OPERA | ||||
| TIONS | -777 | 239 | -836 | 38 |
| Cash flow for the period from discontinued operations |
5.5 | 8.2 | 2.2 | 3.0 |
| Share of Associates Income | 0.6 | $-0.2$ | 0.2 | 0.1 |
| Head Quartersperations before change in working capital | -98 | -27 | -63 | -12 |
| Change in working capital | -102 | -19 | -94 | -22 |
| Cash flow from operations | -200 | -46 | -157 | -34 |
| Acquisition of subsidiaries | -527 | -148 | -53 | - |
| Sale of subsidiary | 98 | - | 98 | - |
| Investments in tangible and biological fixed assets | -58 | -8 | -26 | -8 |
| Sales of tangible and biological fixed assets | 0 | 0 | 0 | 6 |
| Investments in intangible fixed assets | -11 | -4 | -11 | -4 |
| Investments in shares and other securities | -4 806 | -1 884 | -508 | -1 373 |
| Sales of shares and other securities | 569 | 28 | 0 | 28 |
| Dividends received | 2 833 | 4 180 | 294 | 0 |
| Changes in loan receivables | 210 | 9 | 144 | 0 |
| Interest received | 25 | 7 | 22 | 2 |
| Cash flow from investing activities | -1 667 | 2 180 | -40 | -1 350 |
| Change in interest-bearing liabilities | 2 739 | -575 | -617 | 1 440 |
| Interest paid | -140 | -73 | -37 | -19 |
| Contribution from holders of non-controlling interest | 15 | - | 15 | - |
| Dividend paid to equity holders of the Parent company | -1 524 | -1 247 | - | - |
| Dividend paid to holders of non-controlling interest | - | - | - | - |
| Cash flow from financing activities | 1 090 | -1 895 | -639 | 1 421 |
| CASH FLOW FOR THE PERIOD FROM CONTINUING OPERA | ||||
| TIONS | -777 | 239 | -836 | 38 |
| Cash flow for the period from discontinued operations |
$-7.6$ | $-12.6$ | $-2.9$ | $-5.9$ |
| Totaln working capital | -102 | -19 | -94 | -22 |
| Cash flow from operations | -200 | -46 | -157 | -34 |
| Acquisition of subsidiaries | -527 | -148 | -53 | - |
| Sale of subsidiary | 98 | - | 98 | - |
| Investments in tangible and biological fixed assets | -58 | -8 | -26 | -8 |
| Sales of tangible and biological fixed assets | 0 | 0 | 0 | 6 |
| Investments in intangible fixed assets | -11 | -4 | -11 | -4 |
| Investments in shares and other securities | -4 806 | -1 884 | -508 | -1 373 |
| Sales of shares and other securities | 569 | 28 | 0 | 28 |
| Dividends received | 2 833 | 4 180 | 294 | 0 |
| Changes in loan receivables | 210 | 9 | 144 | 0 |
| Interest received | 25 | 7 | 22 | 2 |
| Cash flow from investing activities | -1 667 | 2 180 | -40 | -1 350 |
| Change in interest-bearing liabilities | 2 739 | -575 | -617 | 1 440 |
| Interest paid | -140 | -73 | -37 | -19 |
| Contribution from holders of non-controlling interest | 15 | - | 15 | - |
| Dividend paid to equity holders of the Parent company | -1 524 | -1 247 | - | - |
| Dividend paid to holders of non-controlling interest | - | - | - | - |
| Cash flow from financing activities | 1 090 | -1 895 | -639 | 1 421 |
| CASH FLOW FOR THE PERIOD FROM CONTINUING OPERA | ||||
| TIONS | -777 | 239 | -836 | 38 |
| Cash flow for the period from discontinued operations |
3.9 | 4.7 | $-0.9$ | $-1.8$ |
Revenue decreased 1% quarter-on-quarter. On a like-forlike basis - adjusting for new investments, divestments and
Kinnevik's holdings
currency - revenue has decreased 6% for the quarter with revenue growth in emerging markets and revenue decline in European operations.
The EBIT loss for the third quarter was EUR 0.9m. Last year's results include a EUR 2.8m legal provision. Excluding this legal provision, the results for the third quarter declined by EUR 1.9m. The decline in EBIT is explained by the launch costs in Colombia and negative sales growth in Europe.
The third quarter is a seasonally weak quarter in Europe due to summer holiday. In addition, the uncertain economic environment in the Euro-zone continues to have an effect on the advertising market. The newspaper advertising market continued to be weak in Denmark and Holland, and now also the newspaper advertising market in Sweden shows signs of softening.
Metro continues to grow sales in Russia and Latin America. Metro Mexico showed sales growth of 21% yearon-year, partly as a result of the launch of a new edition in Guadalajara but also from an increase in market shares in Mexico City. Metro St Petersburg had a sales growth of 4% year-on-year mainly resulting from increased page rates based on improved readership.
Metro Holland was sold on 29 August 2012 to Telegraaf Media Groep. As a part of this transaction, Metro has entered into a franchise agreement with the new owner who will continue to publish the Metro newspaper in Holland along with its other free daily newspaper, Sp!ts.
Paper & Packaging
| Investment (SEK m) | Ownership | Estimated fair value |
|---|---|---|
| Korsnäs 1) | -777 | 239 |
| Cash flow for the period from discontinued operations |
100% | 11 000 |
| Interest bearing net debt relating to Korsnäs |
$-5724$ | |
| TotalW FOR THE PERIOD | 269 | 109 |
| Exchange rate differences in liquid funds | 0 | 0 |
| Cash and short-term investments, opening balance | 182 | 150 |
| Cash and short-term investments, closing balance | 451 | 259 |
.
CONDENSED CONSOLIDATED BALANCE SHEET (SEK m)
| 2012 | 2011 | 2011 | ||
|---|---|---|---|---|
| ASSETS | Note | 30 Sept | 30 Sept | 31 Dec |
| Fixed assets | ||||
| Intangible fixed assets | 1 037 | 952 | 957 | |
| Tangible and biological fixed assets | 265 | 6 379 | 6 526 | |
| Financial assets accounted to fair value through | ||||
| profit and loss | 3 | 57 112 | 52 978 | 58 615 |
| - whereof interest-bearing | 19 | 175 | 227 | |
| Financial assets held to maturity | - | 253 | 263 | |
| Investments in companies accounted for using the |
5276 |
1)and short-term investments, opening balance | 182 | 150 | 1 065 | 221 | 150 |
| Cash and short-term investments, closing balance | 451 | 259 | 451 | 259 | 182 |
.
CONDENSED CONSOLIDATED BALANCE SHEET (SEK m)
| 2012 | 2011 | 2011 | ||
|---|---|---|---|---|
| ASSETS | Note | 30 Sept | 30 Sept | 31 Dec |
| Fixed assets | ||||
| Intangible fixed assets | 1 037 | 952 | 957 | |
| Tangible and biological fixed assets | 265 | 6 379 | 6 526 | |
| Financial assets accounted to fair value through | ||||
| profit and loss | 3 | 57 112 | 52 978 | 58 615 |
| - whereof interest-bearing | 19 | 175 | 227 | |
| Financial assets held to maturity | - | 253 | 263 | |
| Investments in companies accounted for using the Including 5% of the shares in Bergvik Skog AB and 75% in Latgran Biofuels AB. |
| Return Paper & Packaging | 1 vear | 5 years |
|---|---|---|
| Average yearly internal rate of return (IRR) 2) | 2012 | |
| --------------------------------------------------------------------------------------------------------------------- | ------ | --------- |
| ASSETS | Note | 30 Sept |
| Fixed assets | ||
| Intangible fixed assets | 1 037 | |
| Tangible and biological fixed assets | 265 | |
| Financial assets accounted to fair value through | ||
| profit and loss | 3 | 57 112 |
| - whereof interest-bearing | 19 | |
| Financial assets held to maturity | - | |
| Investments in companies accounted for using the |
13% | 12% |
| 2)ED CONSOLIDATED BALANCE SHEET (SEK m) |
| 2012 | 2011 | 2011 | ||
|---|---|---|---|---|
| ASSETS | Note | 30 Sept | 30 Sept | 31 Dec |
| Fixed assets | ||||
| Intangible fixed assets | 1 037 | 952 | 957 | |
| Tangible and biological fixed assets | 265 | 6 379 | 6 526 | |
| Financial assets accounted to fair value through | ||||
| profit and loss | 3 | 57 112 | 52 978 | 58 615 |
| - whereof interest-bearing | 19 | 175 | 227 | |
| Financial assets held to maturity | - | 253 | 263 | |
| Investments in companies accounted for using the Return calculated as net profit divided by average invested capital. |
On 20 June, Kinnevik signed an agreement with Billerud AB regarding a merger between Korsnäs (including shares in Bergvik Skog and Latgran Biofuels) and Billerud. Kinnevik will become the largest owner in the new company with an ownership stake of 25%. The merger is a natural step to strengthen Korsnäs and Billerud's successful businesses in virgin fiber packaging material with the aim to create a leading international player within the packaging industry. Korsnäs and Billerud and their respective main owners identify significant synergy potential which is expected to be realised within the next few years as a result of the transaction. The synergy potential has been assessed to at least SEK 300m annually in a preliminary estimate. Per Lindberg, current CEO of Billerud, will be CEO and president of the new company and Christer Simrén, Korsnäs' current CEO will be vice-president and Chief Operating Officer. Completion of the transaction is subject to customary approvals from relevant competition authorities.
Korsnäs
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| Key data (SEK m) 1) | 2012 | 2011 | 2012 | 2011 |
| Korsnäs Industrial | ||||
| Revenue | 5696 | 5 4 0 6 | 1845 | 1 7 9 4 |
| FBITal assets held to maturity | - | 253 | 263 | |
| Investments in companies accounted for using the |
742 | 752 | 304 | 330 |
| Operating margin | 13.0% | 13.9% | 16.5% | 18.4% |
| Korsnäs Forestry | 58 475 | 60 741 | 66 603 | |
| Current assets | ||||
| Inventories | 61 | 2 071 | 2 180 | |
| Trade receivables | 341 | 904 | 771 | |
| Tax receivables | - | 25 | ||
| Other current assets | 324 | 211 | 307 | |
| Short-term investments | 2 | 14 | 0 | |
| Cash and cash equivalents | 387 | 245 | 182 | |
| 1 115 | 3 445 | 3 465 | ||
| 10 782 | - | - | ||
| Assets classified as held for sale |
||||
| Revenue | 783 | 835 | 226 | 268 |
| EBITries | 61 | 2 071 | 2 180 | |
| Trade receivables | 341 | 904 | 771 | |
| Tax receivables | - | 25 | ||
| Other current assets | 324 | 211 | 307 | |
| Short-term investments | 2 | 14 | 0 | |
| Cash and cash equivalents | 387 | 245 | 182 | |
| 1 115 | 3 445 | 3 465 | ||
| 10 782 | - | - | ||
| Assets classified as held for sale |
13 | 32 | $\mathfrak{p}$ | 12 |
| Korsnäs Group | ||||
| Revenue | 6479 | 6 2 4 1 | 2072 | 2 0 6 2 |
| EBITurrent assets | 324 | 211 | 307 | |
| Short-term investments | 2 | 14 | 0 | |
| Cash and cash equivalents | 387 | 245 | 182 | |
| 1 115 | 3 445 | 3 465 | ||
| 10 782 | - | - | ||
| Assets classified as held for sale |
755 | 784 | 306 | 342 |
| Operating margin | 11.7% | 12.6% | 14.8% | 16.6% |
| Return on operational capital | 11.9% | 12.8% | 15.0% | 16.7% |
| Cash flow data | 1 115 | 3 445 | 3 465 | |
| 10 782 | - | - | ||
| Assets classified as held for sale |
||||
| EBITDA | 10 782 | - | - | |
| Assets classified as held for sale |
1 2 1 8 | 1 239 | 461 | 494 |
| Change in working capital | 203 | $-444$ | $-7$ | $-162$ |
| Cash flow from operations | 1 3 6 6 | 593 | 405 | 270 |
| Investments in tangible fixed assets | $-411$ | $-395$ | $-103$ | $-122$ |
| Production, thousand tons | 785 | 814 | 264 | 280 |
| Deliveries, thousand tons | 800 | 764 | 262 | 255 |
1)est-bearing loans | | 4 381 | 5 820 | 4 936 |
| Provisions for pensions | | 39 | 525 | 534 |
| Other provisions | | 4 | 10 | 9 |
| Deferred tax liability | | - | 1 060 | 1 060 |
| Other liabilities | | 17 | 4 | 12 |
| | | 4 441 | 7 419 | 6 551 |
| Short-term liabilities | | | | |
| Interest-bearing loans | | 73 | 658 | 1 741 |
| Provisions | | 1 | 24 | 19 |
| Trade payables | | 155 | 956 | 999 |
| Income tax payable | | 19 | 11 | 10 |
| Other payables | | 469 | 542 | 1 061 |
| | | 717 | 2 191 | 3 830 |
| Liabilities directly associated with assets classified
Excluding Latgran Biofuels AB.
Korsnäs' operating profit for the third quarter amounted to SEK 306m (342). The decline was due to lower production
Kinnevik's holdings
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| Explanation items in changes in EBIT (SEK m) | Jan-Sept | July-Sept |
|---|---|---|
| EBIT 2011 | 784 | 342 |
| Delivery and production volumes and changed product mix |
-28 | -28 |
| Sales prices including currency effects | -4 | -23 |
| Cost changes for energy | 119 | 44 |
| Cost changes for pulpwood and external pulp | 49 | 19 |
| Cost changes for chemicals | -65 | -30 |
| Change in fixed costs | -99 | -26 |
| Other | -1 | 8 |
| EBIT 2012 | 755 | 306 |
Market
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volume divided per product January-September 2012
The figures shown within brackets refer to the comparable period previous year.
Production
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Distribution of operating costs January-September 2012
Excluding depreciation, Korsnäs Industrial. The figures shown within brackets refer to the comparable period previous year.
Investments and maintenance stoppages
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Kinnevik's holdings
paid to date. The installation in the machinery will be performed during the scheduled stoppage in the autumn. The investment is an aggressive quality investment to improve the surface of the cartonboard.
The decision was also taken to invest SEK 250m in a refurbishment of KM5 in Frövi, of which SEK 21m has been paid to date. The project planning of the refurbishment is ongoing and the actual refurbishment will be performed during the scheduled maintenance stoppages in spring 2013. The refurbishment will improve the appearance and printability of cartonboard and produce improved stiffness. Maintenance stoppages for the year in the plants in Gävle and Frövi were scheduled for the same quarter as 2011, as stated in the table below.
| Implemented and planned maintenance stoppages |
2012 | 2011 |
|---|---|---|
| Korsnäs Gävle | Q4: 11 days | Q4: 11 davs |
| Korsnäs Frövi | $Q2: 8$ days | $Q2: 8$ days |
Latgran
Latgran conducts production of pellets from forest raw materials at the company's three production facilities in Latvia. All production is exported to several major industrial customers in Scandinavia and the rest of Northern Europe.
| Jan-Sept | July-Sept | |||
|---|---|---|---|---|
| Key data (SEK m) | 2012 | 2011 | 2012 | 2011 |
| Revenue | 341 | 215 | 68 | 54 |
| FBITents in subsidiaries and financial fixed | ||||
| assets | 143 | 1 889 | 2 032 | |
| Investments in tangible and biological and intan | ||||
| gible fixed assets | 9 | 2 | 11 |
| Other | Parent | |||
|---|---|---|---|---|
| operating | company & | Total | ||
| 1 July-30 Sept 2012 | Metro | subsidiaries | other | Group |
| Revenue | 338 | 69 | 3 | 410 |
| Operating costs | -343 | -80 | -25 | -448 |
| Depreciation | -8 | -4 | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | ||||
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | ||||
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | -18 | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
| 37 | 24 | | |
| Production, thousand tons | 300 | 188 | 94 | 60 |
| Deliveries, thousand tons | 295 | 181 | 65 | 36 |
Deliveries during the first nine months of the year were according to multi-year contracts the company has with its major customers. Sales prices rose according to agreements, which offset higher costs for energy and other input goods, why the company's operating margin remained at 11% during the first nine months of the year. The higher production volumes, compared with the year-earlier period, were due to the commissioning of the company's third pellet plant in South-East Latvia during the third quarter of 2011.
Microfinancing
| Investment (SEK m) | Ownership | InvestedGroup |
| Revenue | 338 | 69 | 3 | 410 |
| Operating costs | -343 | -80 | -25 | -448 |
| Depreciation | -8 | -4 | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
amount | Estimated | 338 | 69 | 3 | 410 |
| Operating costs | -343 | -80 | -25 | -448 |
| Depreciation | -8 | -4 | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
fair value |
|--------------------------------------------------|----------------------|---------------------------|--------------------------------|
| Bayport | $43\%$ 1) | -25 | -448 |
| Depreciation | -8 | -4 | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
| 445 | 573 |
| Seamlessn | -8 | -4 | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
| $12\%$ 1) | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
| 16 | 51 |
| Milvik | 58% | 15 | 12 |
| Microvest II | fund participation | 41 | 39 |
| Other | | 28 | 31 |
| Totaln fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
| | 545 | 706 |
| 1)al net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
After warrants have been utilised. | | | |
| Return Microfinancingial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | | | | |
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | | | | |
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | | -18 | | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| | 2012
| | 1 year | 5 years |
| Average yearly internal rate of return (IRR) | | 41% | 17% |
Similar to the manner in which Kinnevik developed telecom services in emerging markets through innovative products and distribution networks, Kinnevik is now searching for investment opportunities in the microfinancing sector.
Bayport, a company offering micro credits and financial services in five African countries (Ghana, Uganda, Zambia, Tanzania and Botswana) as well as in Colombia, is Kinnevik's largest investment in the microfinancing sector. Bayport was founded in 2002 and has grown with profitability into a leading African micro credit company with total assets of around USD 400m. The company has about 249,000 customers and the geographic presence as well as the product portfolio is continuously expanding. Loans are used primarily for financing larger non-recurrent expenses, such as school fees, investment in farming or for small business purposes. Ghana and Zambia are Bayport's largest markets, while also the other countries are displaying rapid growth.
Seamless specialize in solutions for prepaid e-Top Up and Value Added Services for mobile operators, retailers and distributors. Seamless transaction switch ERS 360° processes over 3.1bln transactions each year and has been deployed for more than 40 mobile operators across 26 countries. A recent addition to Seamless product portfolio is Seamless SEQR, a mobile payment and transaction service using QR codes on the front-end and Seamless proprietary transaction switch on the back-end. Seamless was founded in 2001 and its shares are traded on NASDAO OMX Stockholm. Seamless' headquarter is in Stockholm with offices in Accra, Lahore, Mumbai and Riga.
Milvik provides the technology, distribution and insurance solutions which enable mobile telephone operators in emerging markets to provide microinsurance products to their customer base. Milvik is operating in Ghana, Tanzania, Senegal and Bangladesh.
Microvest II is a fund focusing on equity investments in microfinancing companies in emerging markets. The fund has currently nine investments, of which two in India, two in Peru, one in each of Paraguay, El Salvador, Ecuador and Kazakhstan, and one investment in a global microfinance group.
Kinnevik's holdings
Agriculture & Renewable energy
| Investment (SEK m) | Ownership | Invested amount |
Estimated fair value |
|---|---|---|---|
| Black Earth Farming, Russia | 24.9% | 667 | 378 |
| Rolnyvik, Poland | 100% | 174 | 250 |
| Vireo Energy | 78% | 118 | 118 |
| Total | 959 | 746 |
| Return Agriculture & Renewable energy | 1 year | 5 years |
|---|---|---|
| Average yearly internal rate of return (IRR) | -27% | -14% |
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| Jan-July | |||||
|---|---|---|---|---|---|
| Key data (USD m) | 2012 | 2011 | 2011 | ||
| Revenue | 46.5 | 17.6 | 77.6 | ||
| Operating loss, EBIT | -4.1 | -8.2 | -25.2 | ||
| Net loss | -13.3 | -13.2 | -41.7 |
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Parent Company and other
The administration costs within the Parent Company and the Group's other companies amounted to a net expense of SEK 79 m (expense of 62) for the first ninte months of the year after invoicing for services performed.
Risk Management
The Group's financing and management of financial risks is centralized within Kinnevik's finance function and is conducted on the basis of a finance policy established by the Board of Directors. The Group's operational risks are primarily evaluated and managed within the particular business area and then reported to the Kinnevik Board.
The Group has established a model for risk management, the aims of which are to identify, control and reduce risks. The identified risks and how they are managed are reported to the Kinnevik Board on a quarterly basis.
Kinnevik's wholly owned subsidiary Korsnäs accounts for most of the operational risks and they are mainly related to market development, customers and suppliers and the risk for a major accident in the production plants.
Kinnevik is exposed to financial risks mainly in respect of changes in the value of the stock portfolio, changes in market interest rates, exchange rate risks and liquidity and refinancing risks.
The Group is also exposed to political risks since the companies Kinnevik has invested in have a substantial part of their operations in emerging markets such as Latin America, Sub-Saharan Africa and Russia.
For a more detailed description of the Company's risks and risk management, refer to the Board of Directors' report and Note 32 of the 2011 Annual Report.
Accounting principles
The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. This report was prepared in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting.
The accounting principles and calculation methods applied in this report are the same as those described in the 2011 Annual Report.
Related party transaction
Related party transactions for the interim period are of the same character and amounts as the transactions described in the 2011 Annual Report.
Kinnevik Annual General Meeting 2013
The Annual General Meeting will be held on 13 May 2013 in Stockholm. Shareholders wishing to have matters considered at the Annual General Meeting should submit their proposals in writing to [email protected] or to The Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden, at least seven weeks before the Annual General Meeting, in order that the proposal may be included in the notice to the meeting. Further details on how and when to register will be published in advance of the Meeting.
Nomination Committee for the 2013 Annual General Meeting
In accordance with the resolution of the 2012 Annual General Meeting, Cristina Stenbeck has convened a Nomination Committee consisting of members representing the largest shareholders in Kinnevik. The Nomination Committee is comprised of Cristina Stenbeck, Max Stenbeck on behalf of Verdere Sàrl, Wilhelm Klingspor on behalf of the Klingspor family, Ramsay Brufer on behalf of Alecta, and Edvard von Horn on behalf of the von Horn family.
Information about the work of the Nomination Committee can be found on Kinnevik's corporate website at www. kinnevik.se.
Shareholders wishing to propose candidates for election to the Board of Directors of Kinnevik should submit their proposal in writing to [email protected] or to the Company Secretary, Investment AB Kinnevik, Box 2094, SE-103 13 Stockholm, Sweden.
Financial reports
The year-end release for 2012 will be published on 15 February 2013.
Stockholm 19 October 2012
Mia Brunell Livfors President and Chief Executive Officer
Kinnevik discloses the information in this year-end release pursuant to the Swedish Securities Exchange and Clearing Operations Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 8.00 CET on 19 October 2012.
Review Report
Introduction
We have reviewed the condensed interim report for Investment AB Kinnevik (publ) for the period 1 January to 30 September 2012. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the Swedish Standard on Review Engagements, SÖG 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.
Stockholm, 19 October 2012 Ernst & Young AB
Thomas Forslund Authorized Public Accountant
For further information, please visit www.kinnevik.se or contact:
Mia Brunell Livfors, President and Chief Executive Officer, tel +46 (0)8 562 000 00
Torun Litzén, Information and Investor Relations tel +46 (0)8 562 000 83, mobile +46 (0)70 762 00 83
Kinnevik was founded in 1936 and thus embodies seventy-five years of entrepreneurship under the same group of principal owners. Kinnevik's objective is to increase shareholder value, primarily through net asset value growth. The company's holdings of growth companies are focused around the following business sectors; Telecom & Services, Online, Media, Microfinancing, Paper & Packaging and Agriculture & Renewable energy.
Kinnevik has a long history of investing in emerging markets which has resulted in a considerable exposure to consumer sectors in these markets. Kinnevik plays an active role on the Boards of its holdings.
The Kinnevik class A and class B shares are listed on NASDAQ OMX Stockholm's list for Large Cap companies within the financial and real estate sector. The ticker codes are KINV A and KINV B.
CONDENSED CONSOLIDATED INCOME STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | |||
|---|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | ||
| Note | 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| CONTINUING OPERATIONS | ||||||
| Revenue | 1 061 | 233 | 410 | 85 | 330 | |
| Cost of goods sold and services | -623 | -163 | -239 | -54 | -232 | |
| Gross profit/loss | 438 | 70 | 171 | 31 | 98 | |
| Selling, administration, research and development costs |
-517 | -158 | -222 | -64 | -245 | |
| Other operating income | 35 | 17 | 15 | 5 | 23 | |
| Other operating expenses | -44 | -1 | -30 | -1 | -1 | |
| Operating profit/loss | -88 | -72 | -66 | -29 | -125 | |
| Dividends received | 2 | 2 833 | 4 180 | 294 | 0 | 4 947 |
| Change in fair value of financial assets | 2 | -4 217 | -3 218 | 1 626 | -1 323 | 1 074 |
| Interest income and other financial income | 35 | 48 | 8 | 11 | 67 | |
| Interest expenses and other financial expenses | -189 | -122 | -53 | -32 | -168 | |
| Profit/loss after financial items | -1 626 | 816 | 1 809 | -1 373 | 5 795 | |
| Taxes | -44 | 29 | -4 | 14 | 58 | |
| NET PROFIT/LOSS FROM CONTINUING OPERATIONS | -1 670 | 845 | 1 805 | -1 359 | 5 853 | |
| Net profit from discontinued operations | 4 | 518 | 574 | 203 | 239 | 702 |
| Net profit/ loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | 6 555 | |
| Of which attributable to: | ||||||
| Equity holders of the Parent Company | ||||||
| Net profit/loss from continuing operations | -1 662 | 848 | 1 813 | -1 359 | 5 857 | |
| Net profit/loss from discontinued operations | 510 | 569 | 202 | 239 | 696 | |
| Non-controlling interest | ||||||
| Net profit/loss from continuing operations | -9 | -3 | -9 | 0 | -4 | |
| Net profit/loss from discontinued operations | 8 | 5 | 1 | 0 | 6 | |
| Earnings per share | ||||||
| Earnings per share before dilution, SEK | -4.16 | 5.11 | 7.27 | -4.04 | 23.64 | |
| Earnings per share after dilution, SEK | -4.16 | 5.11 | 7.27 | -4.04 | 23.62 | |
| From continuing operations: | ||||||
| Earnings per share before dilution, SEK | -6.02 | 3.05 | 6.51 | -4.90 | 21.12 | |
| Earnings per share after dilution, SEK | -6.02 | 3.05 | 6.51 | -4.90 | 21.10 | |
| Average number of shares before dilution | 277 183 276 | 277 170 733 | 277 183 276 | 277 166 552 | 277 173 242 | |
| Average number of shares after dilution | 277 474 307 | 277 375 189 | 277 483 975 | 277 365 154 | 277 396 143 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (SEK m)
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Net profit/loss for the period | -1 152 | 1 419 | 2 008 | -1 120 | 6 555 |
| Other comprehensive income for the period | |||||
| Translation differences | -63 | 7 | -50 | -2 | -3 |
| Cash flow hedging | 5 | -79 | 4 | -5 | -82 |
| Actuarial profit/loss | 0 | 0 | 0 | 62 | -14 |
| Tax attributable to other comprehensive income | -1 | 21 | -1 | -15 | 25 |
| Total other comprehensive income for the period | -59 | -51 | -47 | 40 | -74 |
| Total comprehensive income for the period | -1 211 | 1 368 | 1 961 | -1 080 | 6 481 |
| Total comprehensive income for the period attributable to: |
|||||
| Equity holders of the Parent Company | -1 203 | 1 364 | 1 973 | -1 082 | 6 478 |
| Non-controlling interest | -8 | 4 | -12 | 2 | 3 |
CONDENSED CONSOLIDATED CASH-FLOW STATEMENT (SEK m)
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| Note | 1 Jan 30 Sept |
1 Jan 30 Sept |
1 July 30 Sept |
1 July 30 Sept |
2011 Full year |
| CONTINUING OPERATIONS | |||||
| Operating profit | -79 | -62 | -63 | -26 | -125 |
| Adjustment for non-cash items | 58 | 42 | 34 | 22 | 53 |
| Taxes paid | -77 | -6 | -34 | -8 | -1 |
| Cash flow from operations before change in working capital | -98 | -27 | -63 | -12 | -73 |
| Change in working capital | -102 | -19 | -94 | -22 | 11 |
| Cash flow from operations | -200 | -46 | -157 | -34 | -62 |
| Acquisition of subsidiaries | -527 | -148 | -53 | - | -148 |
| Sale of subsidiary | 98 | - | 98 | - | - |
| Investments in tangible and biological fixed assets | -58 | -8 | -26 | -8 | -37 |
| Sales of tangible and biological fixed assets | 0 | 0 | 0 | 6 | 0 |
| Investments in intangible fixed assets | -11 | -4 | -11 | -4 | -5 |
| Investments in shares and other securities | -4 806 | -1 884 | -508 | -1 373 | -2 632 |
| Sales of shares and other securities | 569 | 28 | 0 | 28 | 28 |
| Dividends received | 2 833 | 4 180 | 294 | 0 | 4 947 |
| Changes in loan receivables | 210 | 9 | 144 | 0 | -26 |
| Interest received | 25 | 7 | 22 | 2 | 26 |
| Cash flow from investing activities | -1 667 | 2 180 | -40 | -1 350 | 2 153 |
| Change in interest-bearing liabilities | 2 739 | -575 | -617 | 1 440 | -388 |
| Interest paid | -140 | -73 | -37 | -19 | -100 |
| Contribution from holders of non-controlling interest | 15 | - | 15 | - | - |
| Dividend paid to equity holders of the Parent company | -1 524 | -1 247 | - | - | -1 247 |
| Dividend paid to holders of non-controlling interest | - | - | - | - | -4 |
| Cash flow from financing activities | 1 090 | -1 895 | -639 | 1 421 | -1 740 |
| CASH FLOW FOR THE PERIOD FROM CONTINUING OPERA | |||||
| TIONS | -777 | 239 | -836 | 38 | 351 |
| Cash flow for the period from discontinued operations 4 |
1 046 | -130 | 222 | 0 | -319 |
| CASH FLOW FOR THE PERIOD | 269 | 109 | -614 | 38 | 32 |
| Exchange rate differences in liquid funds | 0 | 0 | 0 | 0 | 0 |
| Cash and short-term investments, opening balance | 182 | 150 | 1 065 | 221 | 150 |
| Cash and short-term investments, closing balance | 451 | 259 | 451 | 259 | 182 |
.
CONDENSED CONSOLIDATED BALANCE SHEET (SEK m)
| 2012 | 2011 | 2011 | ||
|---|---|---|---|---|
| ASSETS | Note | 30 Sept | 30 Sept | 31 Dec |
| Fixed assets | ||||
| Intangible fixed assets | 1 037 | 952 | 957 | |
| Tangible and biological fixed assets | 265 | 6 379 | 6 526 | |
| Financial assets accounted to fair value through | ||||
| profit and loss | 3 | 57 112 | 52 978 | 58 615 |
| - whereof interest-bearing | 19 | 175 | 227 | |
| Financial assets held to maturity | - | 253 | 263 | |
| Investments in companies accounted for using the equity method |
61 | 179 | 242 | |
| 58 475 | 60 741 | 66 603 | ||
| Current assets | ||||
| Inventories | 61 | 2 071 | 2 180 | |
| Trade receivables | 341 | 904 | 771 | |
| Tax receivables | - | 25 | ||
| Other current assets | 324 | 211 | 307 | |
| Short-term investments | 2 | 14 | 0 | |
| Cash and cash equivalents | 387 | 245 | 182 | |
| 1 115 | 3 445 | 3 465 | ||
| 10 782 | - | - | ||
| Assets classified as held for sale TOTAL ASSETS |
4 | 70 372 | 64 186 | 70 068 |
| SHAREHOLDERS' EQUITY AND LIABILITIES Shareholders' equity Equity attributable to equity holders of the Parent |
||||
| Company | 56 912 | 54 521 | 59 637 | |
| Equity attributable to non-controlling interest | 92 | 55 | 50 | |
| 57 004 | 54 576 | 59 687 | ||
| Long-term liabilities | ||||
| Interest-bearing loans | 4 381 | 5 820 | 4 936 | |
| Provisions for pensions | 39 | 525 | 534 | |
| Other provisions | 4 | 10 | 9 | |
| Deferred tax liability | - | 1 060 | 1 060 | |
| Other liabilities | 17 | 4 | 12 | |
| 4 441 | 7 419 | 6 551 | ||
| Short-term liabilities | ||||
| Interest-bearing loans | 73 | 658 | 1 741 | |
| Provisions | 1 | 24 | 19 | |
| Trade payables | 155 | 956 | 999 | |
| Income tax payable | 19 | 11 | 10 | |
| Other payables | 469 | 542 | 1 061 | |
| 717 | 2 191 | 3 830 | ||
| Liabilities directly associated with assets classified as held for sale |
4 | 8 210 | - | - |
| TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 70 372 | 64 186 | 70 068 |
CONDENSED REPORT OF CHANGES IN EQUITY FOR THE GROUP (SEK m)
| 2012 1 Jan |
2011 1 Jan |
2012 1 July |
2011 1 July |
2011 | |
|---|---|---|---|---|---|
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Equity, opening balance | 59 687 | 54 425 | 55 035 | 55 653 | 54 425 |
| Total comprehensive income for the period | -1 211 | 1 368 | 1 961 | -1 080 | 6 481 |
| Acquisitions from non-controlling interest | -25 | -5 | 0 | - | |
| Business combination, non-controlling interest | 56 | 22 | 0 | 0 | 22 |
| Contribution from non-controlling interest | 12 | 2 | 7 | 0 | 2 |
| Dividend paid to owners of non-controlling interest | 0 | 0 | 0 | -4 | |
| Dividend paid to shareholders of the Parent company | -1 524 | -1 247 | 0 | 0 | -1 247 |
| Effect of employee share saving programme | 9 | 6 | 6 | 3 | 8 |
| Equity, closing amount | 57 004 | 54 576 | 57 004 | 54 576 | 59 687 |
| Equity attributable to the shareholders of the Parent Company |
56 913 | 54 521 | 56 913 | 54 521 | 59 637 |
| Equity attributable to non-controlling interest | 91 | 55 | 91 | 55 | 50 |
| 2012 | 2011 | 2011 | |
|---|---|---|---|
| KEY RATIOS | 30 Sept | 30 Sept | 31 Dec |
| Debt/equity ratio | 0.08 | 0.13 | 0.12 |
| Equity ratio | 81% | 85% | 85% |
| Net debt | 4 084 | 6 569 | 6 539 |
DEFINITIONS OF KEY RATIOS
| Debt/equity ratio | Interest-bearing liabilities including interest-bearing provisions divided by share holders' equity. |
|---|---|
| Equity ratio | Shareholders' equity including non-controlling interest as percentage of total assets. |
| Net debt | Interest-bearing liabilities including interest-bearing provisions less the sum of inte rest-bearing receivables, short-term investments and cash and cash equivalents. |
| Operating margin | Operating profit after depreciation divided by revenue. |
| Operational capital employed | Average of intangible and tangible fixed assets, investments in companies accounted for using the equity method, inventories and short-term non-interest bearing receiva bles less other provisions and short-term non interest bearing liabilities. |
| Return on operational capital employed | Operating profit after depreciation divided by average operational capital employed. |
NOTES TO THE GROUP'S FINANCIAL STATEMENTS (SEK m)
Note 1 Condensed segment reporting
Kinnevik is a diversified company whose business consists of managing a portfolio of investments and to conduct operations through subsidiaries. The Kinnevik Group's accounting is distributed on the following three accounting segments:
Metro - following the acquisition of Metro on 29 March 2012, Metro is an accounting segment from the second quarter 2012.
Other operating subsidiaries - Rolnyvik, Vireo Energy, Relevant Traffic, Guider Media, Duego Technologies, Milvik and G3 Good Governance Group.
Parent Company & other - all other companies and financial assets (including change in fair value of financial assets). This distribution coincides with the internal structure for controlling and monitoring used by Kinnevik's management.
| 1 Jan-30 Sept 2012 | Metro | Other operating subsidiaries |
Parent company & other |
Total Group |
|---|---|---|---|---|
| Revenue | 797 | 258 | 6 | 1 061 |
| Operating costs | -759 | -273 | -83 | -1 115 |
| Depreciation | -15 | -8 | -2 | -25 |
| Other operating income and expenses | 2 | -11 | 0 | -9 |
| Operating profit/loss | 25 | -34 | -79 | -88 |
| Dividends received | 0 | 2 833 | 2 833 | |
| Change in fair value of financial assets | 4 | -4 221 | -4 217 | |
| Financial net | -47 | -107 | -154 | |
| Profit/loss after financial items | -18 | -34 | -1 574 | -1 626 |
| Investments in subsidiaries and financial fixed assets |
826 | 105 | 4 436 | 5 367 |
| Investments in tangible and biological and intan gible fixed assets |
7 | 60 | 2 | 69 |
| Impairment of goodwill | -18 | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 225 | 8 | 233 |
| Operating costs | -232 | -68 | -300 |
| Depreciation | -19 | -2 | -21 |
| Other operating income and expenses | 10 | 6 | 16 |
| Operating profit/loss | -16 | -56 | -72 |
| Dividends received | 0 | 4 180 | 4 180 |
| Change in fair value of financial assets | 0 | -3 218 | -3 218 |
| Financial net | 2 | -76 | -74 |
| Profit/loss after financial items | -14 | 830 | 816 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 1 889 | 2 032 |
| Investments in tangible and biological and intan | |||
| gible fixed assets | 9 | 2 | 11 |
| Other | Parent | |||
|---|---|---|---|---|
| operating | company & | Total | ||
| 1 July-30 Sept 2012 | Metro | subsidiaries | other | Group |
| Revenue | 338 | 69 | 3 | 410 |
| Operating costs | -343 | -80 | -25 | -448 |
| Depreciation | -8 | -4 | -1 | -13 |
| Other operating income and expenses | 2 | -17 | 0 | -15 |
| Operating profit/loss | -11 | -32 | -23 | -66 |
| Dividends received | 0 | 0 | 294 | 294 |
| Change in fair value of financial assets | 2 | 0 | 1 624 | 1 626 |
| Financial net | 3 | 0 | -48 | -45 |
| Profit/loss after financial items | -6 | -32 | 1 847 | 1 809 |
| Investments in subsidiaries and financial fixed | ||||
| assets | 14 | 17 | 498 | 529 |
| Investments in tangible and biological and | ||||
| intangible fixed assets | 5 | 31 | 1 | 37 |
| Impairment of goodwill | -18 | -18 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 July-30 Sept 2011 | subsidiaries | other | Group |
| Revenue | 83 | 2 | 85 |
| Operating costs | -85 | -17 | -102 |
| Depreciation | -14 | -2 | -16 |
| Other operating income and expenses | 4 | 0 | 4 |
| Operating profit/loss | -12 | -17 | -29 |
| Dividends received | 0 | 0 | 0 |
| Change in fair value of financial assets | 0 | -1 323 | -1 323 |
| Financial net | 1 | -22 | -21 |
| Profit/loss after financial items | -11 | -1 362 | -1 373 |
| Investments in subsidiaries and financial fixed | |||
| assets | 0 | 1 373 | 1 373 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 9 | 2 | 11 |
| Other | Parent | ||
|---|---|---|---|
| operating | company & | Total | |
| 1 Jan-31 Dec 2011 | subsidiaries | other | Group |
| Revenue | 318 | 12 | 330 |
| Operating costs | -332 | -121 | -453 |
| Depreciation | -22 | -2 | -24 |
| Other operating income and expenses | 15 | 7 | 22 |
| Operating profit/loss | -21 | -104 | -125 |
| Dividends received | 4 947 | 4 947 | |
| Change in fair value of financial assets | 1 074 | 1 074 | |
| Financial net | 0 | -101 | -101 |
| Profit/loss after financial items | -21 | 5 816 | 5 795 |
| Investments in subsidiaries and financial fixed | |||
| assets | 143 | 3 127 | 3 270 |
| Investments in tangible and biological and | |||
| intangible fixed assets | 39 | 2 | 41 |
Note 2 Change in fair value of financial assets and dividends received
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Listed holdings | |||||
| Millicom | -2 370 | 2 009 | -1 570 | 946 | 2 965 |
| Tele2 | -244 | 1 802 | 1 653 | 122 | 2 873 |
| Transcom | 61 | -205 | 28 | -86 | -314 |
| CDON | 52 | -101 | -1 | -211 | 108 |
| Groupon, direct ownership | -627 | 0 | 0 | 0 | 747 |
| MTG | -397 | -2 188 | -393 | -1 915 | -1 472 |
| Metro 1) | 39 | -290 | 0 | -213 | -382 |
| Seamless | 34 | 0 | 19 | 0 | - |
| Black Earth Farming | -50 | -286 | 99 | -214 | -396 |
| Total listed holdings | -3 502 | 741 | -165 | -1 571 | 4 129 |
| Unlisted holdings | |||||
| Online | 2 063 | 165 | 2 077 | 167 | 1 811 |
| Media | 3 | - | 3 | - | - |
| Microfinancing | 52 | 48 | 5 | 73 | 73 |
| Agriculture | 0 | 8 | 0 | 8 | 8 |
| Total unlisted holdings | 2 118 | 221 | 2 085 | 248 | 1 892 |
| Total | -1 384 | 962 | 1 920 | -1 323 | 6 021 |
Note 3 Financial assets accounted at fair value through profit and loss
| Class | Class | 2012 | 2011 | 2011 | |
|---|---|---|---|---|---|
| A shares | B shares | 30 Sept | 30 Sept | 31 Dec | |
| Listed holdings | |||||
| Millicom | 37 835 438 | 23 061 | 25 898 | 26 088 | |
| Tele2 | 18 507 492 | 116 988 645 | 16 124 | 17 059 | 18 129 |
| Transcom | 247 164 416 | 163 806 836 | 250 | 128 | 189 |
| CDON | 16 639 607 | 681 | 419 | 629 | |
| Groupon, direct ownership | - | - | - | - | 1 197 |
| MTG | 5 119 491 | 8 384 365 | 3 917 | 3 720 | 4 436 |
| Metro 1) | 0 | 369 | 277 | ||
| Seamless | 2 300 000 | 51 | - | - | |
| Black Earth Farming | 31 087 097 | 378 | 538 | 427 | |
| Total listed holdings | 44 462 | 48 131 | 51 372 | ||
| Unlisted holdings | |||||
| Online | 11 925 | 3 639 | 5 895 | ||
| Media | 82 | - | - | ||
| Microfinancing | - | 588 | 440 | ||
| Paper & Packaging | 639 | 406 | 656 | ||
| Agriculture | 3 | 3 | 3 | ||
| Parent Company & other | 1 | 211 | 249 | ||
| Total unlisted holdings | 12 650 | 4 847 | 7 243 | ||
| Total | 57 112 | 52 978 | 58 615 |
1) Metro became a subsidiary to Kinnevik on 29 March 2012. The change in fair value for the first nine months 2012 relates to the period from 1 January until the bid was published on 6 February.
Note 4 Discontinued operations
On 20 June 2012, Kinnevik announced that it has signed an agreement with Billerud AB regarding a merger between Korsnäs and Billerud. Kinnevik will receive SEK 2.7bln in cash consideration and will be the largest owner in the new company with an ownership stake of 25%, all net after the planned rights issue in Billerud amounting to SEK 2bln. The shares in the new company have been assigned a value of SEK 2.6bln. Billerud will take over debt in the amount of SEK 5.7bln relating to Korsnäs and Latgran. Korsnäs is thus valued at approximately SEK 11bln.
The transaction, which is expected to be complete in the fourth quarter 2012, is subject to customary approvals from relevant competition authorities. The divestments of Korsnäs, 75% of the shares in Latgran Biofuels and 5% of the shares in Bergvik Skog has been reported separately as discontinued operations in the income statement, with retrospective effect on previous periods, and in the balance sheet from 30 June 2012 according to IFRS 5-Non-current assets held for sale and discontinued operations.
Financial statements
Income statement for discontinued operations
| 2012 1 Jan 30 Sept |
2011 1 Jan 30 Sept |
2012 1 July 30 Sept |
2011 1 July 30 Sept |
2011 Full year |
|
|---|---|---|---|---|---|
| Revenue | 6 744 | 6 386 | 2 123 | 1 974 | 8 699 |
| Operating costs | -5 506 | -5 171 | -1 656 | -1 494 | -7 268 |
| Depreciation | -478 | -464 | -160 | -154 | -623 |
| Other operating income and expenses | 41 | 66 | 9 | 20 | 143 |
| Operating profit/loss | 801 | 817 | 316 | 346 | 951 |
| Dividends received | 4 | 4 | 0 | 0 | 4 |
| Change in fair value of financial assets | 11 | 28 | 2 | 8 | 97 |
| Financial net | -133 | -117 | -46 | -42 | -158 |
| Profit/loss after financial items | 683 | 732 | 272 | 312 | 894 |
| Taxes | -165 | -158 | -69 | -73 | -192 |
| Net profit for the period | 518 | 574 | 203 | 239 | 702 |
Assets and liabilities held for sale
| 2012 | |
|---|---|
| 30 Sept | |
| Fixed assets | |
| Intangible fixed assets | 781 |
| Tangible and biological fixed assets | 6 244 |
| Financial assets accounted to fair value | |
| through profit and loss | 669 |
| Investments in companies accounted for | |
| using the equity method | 276 |
| 7 970 | |
| Current assets | |
| Inventories | 1 838 |
| Trade receivables | 780 |
| Other current assets | 135 |
| Cash and cash equivalents | 59 |
| 2 812 | |
| TOTAL ASSETS | 10 782 |
| 2012 30 Sept |
|
|---|---|
| Long-term liabilities | |
| Interest-bearing loans | 5 302 |
| Provisions | 502 |
| Deferred tax liability | 1 062 |
| 6 866 | |
| Short-term liabilities | |
| Provisions | 27 |
| Trade payables | 858 |
| Income tax payable | 43 |
| Other payables | 416 |
| 1 344 | |
| TOTAL LIABILITIES | 8 210 |
Cash flow statement for discontinued operations
| 2012 | 2011 | 2012 | 2011 | ||
|---|---|---|---|---|---|
| 1 Jan | 1 Jan | 1 July | 1 July | 2011 | |
| 30 Sept | 30 Sept | 30 Sept | 30 Sept | Full year | |
| Cash flow from operations | |||||
| 1 401 | 623 | 400 | 249 | 843 | |
| Cash flow from investing acti | |||||
| vities | -443 | -493 | -103 | -138 | -855 |
| Cash flow from financing | |||||
| activities | 88 | -260 | -75 | -111 | -307 |
| Cash flow for the period | 1 046 | -130 | 222 | 0 | -319 |
CONDENSED PARENT COMPANY INCOME STATEMENT (SEK m)
| 2012 1 Jan 30 Sept |
2011 1 Jan 30 Sept |
2012 1 July 30 Sept |
2011 1 July 30 Sept |
2011 Full year |
|
|---|---|---|---|---|---|
| Revenue | 14 | 14 | 4 | 5 | 18 |
| Administration costs | -80 | -69 | -25 | -23 | -121 |
| Other operating income | 0 | 1 | 0 | 0 | 2 |
| Operating loss | -66 | -54 | -21 | -18 | -101 |
| Dividends received | 3 756 | 3 623 | 0 | 140 | 3 640 |
| Result from financial assets | 111 | -533 | 0 | -533 | -661 |
| Net interest income/expense | 255 | 262 | 88 | 97 | 111 |
| Profit/loss after financial items | 4 056 | 3 298 | 67 | -314 | 2 989 |
| Taxes | -18 | -55 | 0 | -21 | -8 |
| Net profit/loss for the period | 4 038 | 3 243 | 67 | -335 | 2 981 |
CONDENSED PARENT COMPANY BALANCE SHEET (SEK m)
| 2012 30 Sept |
2011 30 Sept |
2011 31 Dec |
|
|---|---|---|---|
| ASSETS | |||
| Tangible fixed assets | 3 | 2 | 2 |
| Financial fixed assets | 50 144 | 42 597 | 42 581 |
| Short-term receivables | 53 | 23 | 569 |
| Cash and cash equivalents | 0 | 2 | 1 |
| TOTAL ASSETS | 50 200 | 42 624 | 43 153 |
| SHAREHOLDERS' EQUITY AND LIABILITIES | |||
| Equity | 41 232 | 38 973 | 38 712 |
| Provisions | 31 | 31 | 32 |
| Long-term liabilities | 8 609 | 2 853 | 1 828 |
| Short-term liabilities | 328 | 767 | 2 581 |
| TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 50 200 | 42 624 | 43 153 |
The Parent Company's liquidity, including short-term investments and unutilized credit facilities, totalled SEK 3,191m at 30 September 2012 and SEK 4,437m at 31 December 2011. The Parent Company's interest bearing external liabilities amounted to SEK 8,636m (2,173) on the same dates.
Investments in tangible fixed assets amounted to SEK 2m (1) during the period.
As of 30 September 2012 the number of shares in Investment AB Kinnevik amounted to 277,583,190 shares of which 48,665,324 are class A shares with ten votes each, 228,653,284 are class B shares with one vote each and 264,582 are class C treasury shares with one vote each. In June, 135,332 class C shares were converted to class B shares to be delivered to the participants in the Long Term Incentive Plan for 2009. The total number of votes in the Company amounted at 30 September 2012 to 715,571,106 (715,171,192 excluding 264,582 class C and 135,332 class B treasury shares). The Board has authorization to repurchase a maximum of 10% of all shares in the Company. The Board has not used the authorization during the first nine monts of the year 2012. There are no convertibles or warrants in issue.