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NRC Group Interim / Quarterly Report 2010
3693_rns_2010-10-28_f819a1c9-3afe-4189-a69e-6c42e51e2336.pdf
Interim / Quarterly Report
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BLOM
IMAGING THE WORLD
Report for 3rd quarter 2010
Report for 3rd quarter 2010
Yet another challenging quarter
The company posted revenues of NOK 165 million in the 3rd quarter, compared with NOK 203 million for the same quarter in 2009. EBITDA for the quarter was NOK 33 million, compared with NOK 26 million for the corresponding quarter in 2009. This corresponds to an EBITDA margin of 20 per cent, compared with 13 per cent in the 3rd quarter of 2009. The operating profit for the quarter was NOK 10 million, compared with NOK 4 million for the same period in 2009.
The operating revenues for the respective segments totalled NOK 110 million for Geo Engineering and NOK 55 million for Information Services in the 3rd quarter. The comparative figures for the 3rd quarter of 2009 were NOK 169 million for Geo Engineering and NOK 34 million for Information Services.
The demand for the company's contractual services, for which the public sector is the largest customer group, has been marked so far in 2010 by a continuing weak economy in a number of countries in which we have a significant portion of our operations. This has resulted in temporary pressure on the prices in parts of our operations and delayed call-off orders under framework agreements. Revenues in Geo Engineering are expected to be lower in 2010 than in 2009.
The backlog of orders that are to be filled next year is greater than at the same time last year. The company has chosen to focus on services for which satisfactory margins can be achieved, which is expected to improve our profitability when the orders are filled in 2011. In addition, due to the weak macroeconomic conditions, the company has reduced its workforce and implemented other cost savings, which are expected to give annualised savings of around NOK 50 million. The company is expected accordingly to generate stronger margins in 2011 than in the current year.
In the Information Services area the company has reorganised and accelerated the build-up of its own sales force during the quarter. In combination with the implementation of a more sales-oriented partnership, over time these measures are expected to improve the company's ability to sell the same data to multiple customers through different distribution channels.
Results
| IFRS
(Amounts in NOK 1000) | 3rd quarter | | As at 30/9 | |
| --- | --- | --- | --- | --- |
| | 2010 | 2009 | 2010 | 2009 |
| Operating revenues | 164 721 | 202 793 | 470 630 | 577 419 |
| EBITDA | 33 146 | 25 795 | 40 723 | 69 404 |
| EBIT | 10 284 | 3 566 | -24 819 | 4 989 |
| EBT | 3 079 | -4 346 | -65 070 | -19 492 |
Report for 3rd quarter 2010
This report has been prepared in accordance with IAS 34 on interim accounts. The interim accounts do not contain all the information that is required in complete annual accounts, and they should be read in conjunction with the consolidated accounts for 2009. The interim accounts have been prepared in accordance with the same principles that are used in the annual accounts for 2009. The report has not been audited.
Operations
Information Services achieved revenues of NOK 55 million this quarter, compared with NOK 34 million in the 3rd quarter of 2009. The company has continued to reorganise and build up its own sales force in this segment, and the company's sales territory has been strengthened qualitatively and quantitatively as a result of this. In combination with the implementation of more sales-oriented partnerships, over time these measures are expected to improve the company's ability to sell the same data to multiple customers through different distribution channels.
The company has also strengthened the strategic cooperation between Blom and NDrive, which will make Blom's technology stronger in the market for navigation solutions, a market that is estimated to grow an average of 33 per cent annually according to Berg Insight.
Geo Engineering Services achieved revenues of NOK 110 million this quarter, compared with NOK 169 million in the 3rd quarter of 2009. As a result of the challenging weather conditions early in the quarter and relatively little data acquisition, as well as weaker macroeconomics in a number of countries in which the company operates, revenues in the segment were lower than the corresponding quarter in 2009.
The following agreements have been entered into in the 3rd quarter:
Blom signed an agreement to sell technology rights
In August Blom entered into an agreement with NDrive, a Portuguese supplier of navigation systems and mobile solutions. The agreement encompasses the sale of certain technology rights for navigation on mobile units from Blom to NDrive. This will generate estimated revenues of around NOK 25 million for Blom in 2010. This transaction strengthens the strategic cooperation between Blom and NDrive, and it will strengthen NDrive's position in the market for navigation solutions.
Blom awarded contract for aerial triangulation and mapping services in Belgium
In July Blom entered into a contract with the Belgian authorities for aerial triangulation and mapping services for a number of the municipalities in Belgium. This project will be completed in the 3rd quarter of 2011.
Pictometry
After the end of the quarter Pictometry International Corp. has advised Blom ASA that the company finds that Blom has breached the licence agreement that was entered into in January 2009 and terminated the agreement with immediate effect. Blom is of the clear opinion that Blom has not acted in breach of the agreement and that the termination is thus invalid. Blom has in the short run taken steps necessary to safeguard the company's
Report for 3rd quarter 2010
interests through its legal advisors. Over some time Blom expects to find solutions that ensure our customers, partners and the shareholders interests the best way possible.
Accounts and finance
The company had a positive cash flow from operational activities of NOK 24 million in the 3rd quarter. Receivables from customers declined from the 2nd quarter to NOK 125 million, while work in progress was NOK 277 million, compared with NOK 281 million for the previous quarter.
In the third quarter the company made operational investments of NOK 13 million in databases and advanced technology. The equity ratio was 49.5 per cent, up 0.2 per cent from the start of the year. Cash and cash equivalents were reduced by NOK 35 million to NOK 89 million during the period, primarily as the result of investments in BlomURBEX, paying off factoring and leasing debts, as well as interest and renegotiation costs related to Blom’s bond loan.
As at 30 September 2010 the company satisfies the covenant requirements for the company’s bond loan (ISIN NO 001053847.3).
Organisation and personnel
During this period the company has also adjusted its workforce, based on the demand for the company’s products in the market. Due to the continued restructuring of the group, combined with improved coordination and utilisation of the company’s resources, as well as the introduction of new technology, a decision has been made to implement additional workforce reductions in the 4th quarter of 2010.
The company has a staff of employees with a high level of competence. This represents the foundation for the company’s future growth. As at 30 September 2010 there was a total of 543 employees in the operative companies, while there was a total of 600 employees at the production facilities in Indonesia and Eastern Europe. The group has a total of 1,143 employees.
Shareholder matters
The total number of shareholders as at 30 September 2010 was 2,697, and foreign shareholders accounted for 41.5 per cent of the share capital. Blom owns a total of 1,100,000 of the company’s own shares, which represents 2.64 per cent of the total number of outstanding shares.
Future outlook
Report for 3rd quarter 2010
Due to the fact that the continuing weak economy in a number of countries has temporarily increased the pressure on prices in parts of our operations and delayed call-off orders under framework agreements, the company has decided to focus on services where satisfactory margins can be achieved. This strategy is expected to result in negative growth in the company's revenues for 2010. The company has significantly reduced its cost base this year and have a satisfactory backlog of orders, which will provide a good foundation for greater profitability in 2011.
Oslo, 27 October 2010
Gunnar Hirsti
Board Chairman
Per Kyllingstad
Board Member
Bente Loe
Board Member
Brita Eilertsen
Board Member
Dirk Blaauw
Managing Director and Board Member
Report for 3rd quarter 2010
Consolidated Comprehensive Profit and Loss Account – Blom Group
(Amounts in NOK 1000)
| 3rd quarter | 30/09/10 | 30/09/09 | 31/12/09 | ||
|---|---|---|---|---|---|
| 2010 | 2009 | ||||
| 164 721 | 202 793 | Operating revenues | 470 630 | 577 419 | 736 901 |
| 45 816 | 86 872 | Cost of materials | 160 418 | 215 305 | 242 461 |
| 64 472 | 70 047 | Salaries and personnel costs | 202 810 | 226 237 | 297 554 |
| 22 862 | 22 229 | Depreciation and write-downs | 65 542 | 64 415 | 146 138 |
| 21 287 | 20 079 | Other operating and administrative costs | 66 679 | 66 473 | 104 580 |
| 154 437 | 199 227 | Operating expenses | 495 449 | 572 430 | 790 733 |
| 10 284 | 3 566 | Operating profit/loss | -24 819 | 4 989 | -53 832 |
| 930 | 74 | Profit attributable to associates | 1 744 | -638 | -565 |
| -8 136 | -7 986 | Net financial items | -41 996 | -23 843 | -39 562 |
| 3 079 | -4 346 | Pre-tax profit/loss | -65 070 | -19 492 | -93 960 |
| -618 | 1 210 | Taxes | 18 037 | 5 503 | 10 949 |
| 2 461 | -3 136 | Net profit/loss after tax | -47 033 | -13 989 | -83 012 |
| Profit/loss attributable to: | |||||
| 2 461 | -3 146 | Shareholders | -47 065 | -13 688 | -82 505 |
| 0 | 10 | Minority interests | 32 | -301 | -506 |
| 2 461 | -3 136 | Net profit/loss after tax | -47 033 | -13 989 | -83 012 |
| Comprehensive profit/loss: | |||||
| -2 644 | -32 672 | Currency translation differences | -19 522 | -68 369 | -74 757 |
| -183 | -35 808 | Comprehensive profit/loss | -66 555 | -82 358 | -157 769 |
| Comprehensive profit/loss attributable to: | |||||
| -183 | -35 739 | Shareholders | -65 143 | -81 690 | -156 688 |
| 0 | -69 | Minority interests | -1 413 | -668 | -1 081 |
| -183 | -35 808 | Comprehensive profit/loss | -66 555 | -82 358 | -157 769 |
| Earnings and diluted earnings per share | -1.16 | -0.34 | -2.04 |
Report for 3rd quarter 2010
Balance Sheet – Blom Group
| ASSETS | |||
|---|---|---|---|
| (Amounts in NOK 1000) | |||
| 30/09/2010 | 30/09/2009 | 31/12/2009 | |
| Patents, licences and similar rights | 34 367 | 40 485 | 36 700 |
| Deferred tax assets | 69 218 | 43 820 | 50 428 |
| Goodwill | 263 142 | 319 133 | 270 579 |
| Total intangible fixed assets | 366 726 | 403 438 | 357 707 |
| Tangible fixed assets | 287 473 | 301 787 | 295 797 |
| Long-term receivables | 8 226 | 10 552 | 10 253 |
| Investments in associated companies | 63 671 | 45 173 | 45 246 |
| Total fixed asset investments | 71 897 | 55 725 | 55 498 |
| Total fixed assets | 726 097 | 760 950 | 709 003 |
| Inventories | 2 846 | 3 222 | 2 826 |
| Work in progress | 277 016 | 371 752 | 261 237 |
| Total inventories | 279 863 | 374 974 | 264 062 |
| Receivables from customers | 124 748 | 216 441 | 240 252 |
| Other current receivables | 53 517 | 30 031 | 35 404 |
| Total receivables | 178 265 | 246 472 | 275 656 |
| Cash and cash equivalents | 89 407 | 136 910 | 164 873 |
| Total current assets | 547 535 | 758 356 | 704 592 |
| TOTAL ASSETS | 1 273 631 | 1 519 306 | 1 413 595 |
Report for 3rd quarter 2010
Balance Sheet – Blom Group
| EQUITY AND LIABILITIES | |||
|---|---|---|---|
| (Amounts in NOK 1000) | |||
| 30/09/2010 | 30/09/2009 | 31/12/2009 | |
| Called-up and fully paid share capital: | |||
| Share capital | 4 170 | 4 170 | 4 170 |
| Treasury shares | -110 | -110 | -110 |
| Share premium account | 129 581 | 129 581 | 129 581 |
| Other reserves: | |||
| Currency translation differences | -37 946 | -13 675 | -18 424 |
| Retained earnings | 535 303 | 650 532 | 580 924 |
| 630 998 | 770 498 | 696 141 | |
| Minority interests | -24 | 1 802 | 1 389 |
| Total equity | 630 974 | 772 300 | 697 529 |
| Pension obligations | 20 368 | 19 294 | 20 625 |
| Long-term liabilities | 365 301 | 380 792 | 368 717 |
| Total long-term liabilities | 385 669 | 400 086 | 389 342 |
| Overdraft facilities | 41 603 | 86 178 | 89 824 |
| Other interest-bearing short-term liabilities | 35 640 | 34 198 | 31 031 |
| Total interest bearing short-term liabilities | 77 243 | 120 376 | 120 855 |
| Payables to suppliers | 91 330 | 94 944 | 104 798 |
| Unpaid government taxes | 21 590 | 18 474 | 35 289 |
| Other current liabilities | 66 825 | 113 126 | 65 780 |
| Total other current liabilities | 179 745 | 226 544 | 205 868 |
| Total current liabilities | 256 989 | 346 920 | 326 723 |
| TOTAL EQUITY AND LIABILITIES | 1 273 631 | 1 519 306 | 1 413 595 |
| Change in equity from 1 January to 30 September | 2010 | 2009 | |
| Equity as at 31 December | 697 529 | 855 296 | |
| Profit/loss for the period | -47 033 | -13 989 | |
| Foreign exchange losses/gains from translation of foreign subsidiaries | -19 522 | -69 006 | |
| Equity | 630 974 | 772 300 |
Report for 3rd quarter 2010
Cash Flow Statement – Blom Group
Indirect model (Amounts in whole NOK 1000)
| 3rd quarter | As at 30/09 | |||
|---|---|---|---|---|
| 2010 | 2009 | 2010 | 2009 | |
| CASH FLOW FROM OPERATIONAL ACTIVITIES | ||||
| 3 079 | -4 346 | Pre-tax profit/loss | -65 070 | -19 492 |
| 22 861 | 22 230 + | Depreciation and amortisation of operating assets | 65 542 | 64 416 |
| 24 170 | 1 583 +/- | Change in receivables from customers | 90 574 | 136 578 |
| 3 652 | -53 112 +/- | Change in inventories and work in progress | -15 800 | -135 917 |
| -35 638 | 3 848 +/- | Change in supplier debt | -13 468 | 14 365 |
| 6 012 | -10 513 +/- | Change in other accruals and unrealised foreign exchange | -10 072 | -45 113 |
| 24 137 | -40 310 A = | Net cash flow from operational activities | 51 705 | 14 836 |
| CASH FLOW FROM INVESTMENT ACTIVITIES | ||||
| -13 067 | -15 759 - | Payments for purchase of operating assets | -41 675 | -51 563 |
| -13 067 | -15 759 B = | Net cash flow from investment activities | -41 675 | -51 563 |
| CASH FLOW FROM FINANCING ACTIVITIES | ||||
| -22 251 | 120 525 - | Payments on long-term debt and loans | -40 275 | 86 077 |
| -24 282 | 80 +/- | Net change in overdraft facilities | -45 220 | 11 077 |
| -46 533 | 120 605 C = | Net cash flow from financing activities | -85 496 | 97 154 |
| -35 463 | 64 535 | A+B+C Net change in cash and cash equivalents | -75 467 | 60 428 |
| 124 870 | 72 375 + | Cash and cash equivalents | 164 873 | 76 482 |
| 89 407 | 136 910 = | Cash and cash equivalents | 89 407 | 136 910 |
Report for 3rd quarter 2010
Segments – Blom Group
(Amounts in NOK 1000)
| 3rd qtr. 2010 | 3rd qtr. 2009 | 30/09/2010 | 30/09/2009 | |
|---|---|---|---|---|
| Operating revenues: | ||||
| Information Services | 54 755 | 34 079 | 98 355 | 82 635 |
| Geo Engineering Services | 109 966 | 168 714 | 372 275 | 494 784 |
| Total operating revenues | 164 721 | 202 793 | 470 630 | 577 419 |
| EBITDA: | ||||
| Information Services | 38 448 | 15 148 | 49 352 | 22 780 |
| Geo Engineering Services | 2 428 | 17 884 | 18 386 | 71 607 |
| Others | -7 731 | -7 237 | -27 015 | -24 982 |
| EBITDA | 33 146 | 25 795 | 40 723 | 69 404 |
| EBIT: | ||||
| Information Services | 26 268 | 6 311 | 14 425 | -1 867 |
| Geo Engineering Services | -8 194 | 4 509 | -12 088 | 31 933 |
| Others | -7 790 | -7 254 | -27 156 | -25 078 |
| EBIT | 10 284 | 3 566 | -24 819 | 4 989 |
| Profit attributable to associates: | ||||
| Information Services | 930 | 74 | 1 744 | -638 |
| Profit attributable to associates: | 930 | 74 | 1 744 | -638 |
| Earnings before interest and tax: | ||||
| Information Services | 27 198 | 6 385 | 16 169 | -2 504 |
| Geo Engineering Services | -8 194 | 4 509 | -12 088 | 31 933 |
| Others | -7 790 | -7 254 | -27 156 | -25 078 |
| Earnings before interest and tax | 11 214 | 3 640 | -23 075 | 4 351 |
Report for 3rd quarter 2010
Segments – Blom Group
(Amounts in NOK 1000)
| 3rd qtr. 2010 | 3rd qtr. 2009 | 30/09/2010 | 30/09/2009 | |
|---|---|---|---|---|
| Assets: | ||||
| Information Services | 0 | 0 | 516 129 | 532 232 |
| Geo Engineering Services | 0 | 0 | 537 135 | 783 160 |
| Others/Unallocated | 0 | 0 | 220 368 | 203 914 |
| Total assets 1) | 0 | 0 | 1 273 631 | 1 519 306 |
| Operational investments: | ||||
| Information Services | 10 772 | 10 016 | 36 349 | 34 546 |
| Geo Engineering Services | 10 011 | 9 237 | 24 050 | 26 517 |
| Others/Unallocated | 0 | 0 | 340 | 0 |
| Total assets | 20 783 | 19 253 | 60 739 | 61 063 |
1) Allocated assets include receivables from customers, work in progress, inventories, fixed assets and intangible assets with the exception of deferred tax assets.
Report for 3rd quarter 2010
Blom ASA
P.O. Box 34 Skøyen
N-0212 Oslo
Norway
Tel.: +47 22 13 19 20
Fax: +47 22 13 19 21
E-mail: [email protected]
Blom Sistemas Geoespaciales S.L.
C/ Zurbano 46
28010 Madrid, Spain
Tel.: +34 914 150 350
Fax: +34 9 310 49 14
E-mail: [email protected]
Blom CGR S.p.A.
Via Cremonese 35/A
43126 Parma
Italy
Tel.: +39 0521 994948
Fax: +39 0521 992803
E-mail: [email protected]
Blom Kartta OY
Plasilanraitio 5
FI-00240 Helsinki
Finland
Tel.: +358 9 229 3060
Fax: +358 9 148 1711
E-mail: [email protected]
Blom Geomatics AS
P.O. Box 34 Skøyen
N-0202 Oslo
Norway
Tel.: +47 23 25 45 00
Fax: +47 23 25 45 01
E-mail: [email protected]
Blom Aerofilms Ltd.
Cheddar Business Park
Wedmore Road, BS27 3EB
UK
Tel.: +44 1934 311000
Fax: +44 1334 745825
E-mail: [email protected]
Blom Deutschland GmbH
Oskar-Frech-Strasse 15
73614 Schorndorf, Germany
Tel.: +49 7181 98021 0
Fax: +49 7181 98021 29
E-mail: [email protected]
Blom Romania S.R.L.
Ion Heliade Radulescu Street, no 3-5
130010 Tagoviste
Romania
Tel.: +40(0)245 606 150
Fax: +40(0)245 210 852
E-mail: [email protected]
Blom Sweden AB
Klippan 1J
SE-414 51 Gothenburg
Sweden
Tel.: +46 317 045670
Fax: +46 317 049980
E-mail: [email protected]
BlomInfo AS
Masnedøgade 20
DK-2100 Copenhagen
Denmark
Tel.: +45 70 200 226
Fax: +45 70 200 227
E-mail: [email protected]