Ponsse Oyj

Interim / Quarterly Report • Feb 22, 2022

Ponsse’s Financial Statements for 1 January – 31 December 2021

Ponsse’s Financial Statements for 1 January – 31 December 2021

– Net sales amounted to EUR 750.0 (Q1-Q4/2020 636.6) million.
– Q4 net sales amounted to EUR 226.6 (Q4/2020 205.2) million.
– Operating result totalled EUR 75.0 (Q1-Q4/2020 57.1) million, equalling 10.0
(9.0) per cent of net sales.
– Q4 operating result totalled EUR 18.7 (Q4/2020 13.7) million, equalling 8.3
(6.7) per cent of net sales.
– Profit before taxes was EUR 73.2 (Q1-Q4/2020 39.6) million.
– Cash flow from business operations was EUR 102.4 (74.8) million.
– Earnings per share were EUR 1.97 (1.15).
– Equity ratio was 60.7 (54.3) per cent.
– Order books stood at EUR 439.8 (174.9) million.
– The Board of Directors´ proposal for the distribution of profit is EUR 0.85
(0.60) per share.
– Group´s euro-denominated operating result in 2022 is estimated to be on a par
with 2021.
PRESIDENT AND CEO JUHO NUMMELA:
The year 2021 was a time of growth for Ponsse. We had a record-breaking order
flow, and our order book reached a historical high. Every business area
experienced significant growth and our cash flow was strong throughout the year.
Our company’s solvency is at a good level.
Our customers’ work situation was good throughout the year. The upward trend in
demand for PONSSE forest machines started in the last quarter of 2020. In the
first quarter of 2021, demand accelerated rapidly and increased our volume of
orders significantly. It was soon clear that we could run our Vieremä factory at
full capacity for the whole year, component availability and COVID-19 measures
permitting. The market situation was good everywhere, especially in Russia,
which reclaimed its position as the largest market in the world for Cut-to
-Length forest machines.
The very strong demand and the success of our sales network swelled our order
book very quickly and, by the end of the year, it had reached a record-breaking
EUR 439.8 (174.9) million.
The healthy market conditions were also reflected in our service business. After
sales services grew more than expected as our customers had busy work schedules.
The continuous development of our service business yielded excellent results as
our service business network was able to keep our customers’ machines in
production use worldwide. Our used machine business saw decent growth and we
kept a good stock of trade-in machines.
The fastest-growing business area was Epec Oy, our technology company, which is
now reaping the rewards of a change in strategy. The shifting of our operating
environment towards increasingly eco-friendly technologies has created excellent
opportunities for cutting-edge Epec and Ponsse technology.
Ponsse experienced very strong growth and our net sales in 2021 reached EUR
750.0 (636.6) million, growing by 18 per cent.
This growth required immense effort even in the stable market conditions. The
other side of high demand were the challenges in the availability of components
and parts. Rapid demand for device and machine manufacturing was a challenge for
already vulnerable production networks. High demand together with logistical
issues affected the availability of components and parts and triggered intense
inflation in prices and other operating expenses. Both our service business and
supply chain suffered as a result. Even so, we managed to manufacture every
PONSSE forest machine as planned and delivered them to our customers all over
the world. The problems with the availability of components and parts have put
considerable stress on the people of our company and production network. We are
proud of their superb performance that has allowed our service business network
and factories to keep running. In August, the Vieremä factory finished the
17,000th PONSSE forest machine.
Our net operating profit was EUR 75.0 (57.1) million and our operating profit
margin was 10.0 (9.0) per cent. The growth of our relative net profit was
hampered by the inflation of product costs. Due to this inflation and increases
in operating expenses, more work will be required in the coming years to achieve
our relative profitability target of 12 per cent. Cash flow from business
operations was excellent at EUR 102.4 (74.8) million. We succeeded in managing
our working capital in 2021 and maintained a very good ratio of working capital
to net sales.
We focus on the continuous and appropriate development of Ponsse. Our
distribution and service network is developing quickly around the world. In
2021, we announced an arrangement whereby the functions of dealer FC Ventas Y
Servicios will be transferred to a new subsidiary, Ponsse Chile SpA, in Q1/2022.
We are developing our distribution network and its operations systematically and
seek to expand to new areas as required by our customers. We are investing
continuously in our manufacturing network to increase the capacity and quality
of our production. Our product technology development is proceeding quickly, and
we will be investing more in R&D and new technologies. As a rule, all our
investments are aimed at improving added value for customers.
Ponsse employees have been telecommuting since the start of the COVID-19
pandemic with the exception of our production, sales and service personnel. The
office workers of the Vieremä factory will continue to work from home to protect
the continuity of our production. We will also maintain the utmost precautions
at our other locations to avoid COVID-19 infections. It is vital to keep our
people healthy and maintain optimal customer service efficiency.
NET SALES
Consolidated net sales for the period under review amounted to EUR 750.0 (636.6)
million, which is 17.8 per cent more than in the comparison period.
International business operations accounted for 80.4 (79.6) per cent of net
sales.
Net sales were regionally distributed as follows: Northern Europe 33.3 (39.6)
per cent, Central and Southern Europe 18.2 (23.6) per cent, Russia and Asia 22.2
(14.6) per cent, North and South America 25.9 (21.7) per cent and other
countries 0.4 (0.5) per cent.
PROFIT PERFORMANCE
The operating result amounted to EUR 75.0 (57.1) million. The operating result
equalled 10.0 (9.0) per cent of net sales for the period under review.
Consolidated return on capital employed (ROCE) stood at 20.7 (12.4) per cent.
Staff costs for the period totalled EUR 102.8 (85.7) million. Other operating
expenses stood at EUR 63.6 (47.8) million. The net total of financial income and
expenses amounted to EUR -1.8 (-17.7) million. Exchange rate gains and losses
with a net effect of EUR -1.0 (-15.2) million were recognised under financial
items for the period. The parent company’s receivables from subsidiaries stood
at EUR 37.3 (42.2) million net. Their reduction and the moderate change in
exchange rates have resulted in a significantly reduced impact on financial
items for the period under review. The unrealised exchange rate losses for the
comparison period mainly consist of the assessment of inter-company accounts
payable for Ponsse Latin America Ltda and OOO Ponsse.
Result for the period under review totalled EUR 55.1 (32.3) million. Diluted and
undiluted earnings per share (EPS) came to EUR 1.97 (1.15).
STATEMENT OF FINANCIAL POSITION AND FINANCING ACTIVITIES
At the end of the period under review, the total consolidated statements of
financial position amounted to EUR 512.6 (474.0) million. Inventories stood at
EUR 167.4 (142.1) million. Trade receivables totalled EUR 43.5 (35.4) million,
while cash and cash equivalents stood at EUR 120.9 (123.6) million. Group
shareholders’ equity stood at EUR 297.3 (255.0) million and parent company
shareholders’ equity (FAS) at EUR 226.8 (197.3) million. The amount of interest
-bearing liabilities was EUR 54.8 (114.5) million. The company has ensured its
liquidity by credit facility limits and commercial paper programs, which are not
used at the end of the period under review. Group's loans from financial
institutions are non-collaretal bank loans without financial covenants.
Consolidated net liabilities totalled EUR -66.1 (-9.1) million, and the debt
-equity ratio (net gearing) was -22.2 (-3.6) per cent. The equity ratio stood at
60.7 (54.3) per cent at the end of the period under review.
Cash flow from operating activities amounted to EUR 102.4 (74.8) million. Cash
flow from investment activities came to EUR -24.1 (-20.0) million.
IMPACT OF THE COVID-19 PANDEMIC
The company has recovered from the impacts of covid-19 pandemic on the demand
for products faster than expected. However, the covid-19 pandemic has caused
changes in the company’s operating environment. The company’s management is
actively monitoring the development of the pandemic. The covid-19 pandemic has
had a major impact on the availability of components.
Covid-19 pandemic restrictions have been felt by company operations across the
world. Decisions have been made to ensure the health and safety of the company’s
customers and all Ponsse employees. The company’s white-collar employees have
mainly been teleworking, while manufacturing units and the sales and service
business network are operating as normal.
In terms of financing, the company has carried out all measures necessary to
ensure business continuity. The company has analysed credit risks related to
trade receivables and credit loss provisions and concluded that there are
sufficient provisions at the end of the period under review. The company has not
had any signs of decreases in goodwill or the value of activated development
costs.
Impact on financial reporting
Based on the company’s impairment calculations, there was no need to reduce the
goodwill of any cash-generating unit at the end of the financial period.
The company analysed credit risks related to trade receivables, as well as
credit loss provisions, and concluded that there were enough provisions at the
end of the financial period.
ORDER INTAKE AND ORDER BOOKS
Order intake for the period totalled EUR 1,019.6 (581.7) million, while period
-end order books were valued at EUR 439.8 (174.9) million.
DISTRIBUTION NETWORK
The subsidiaries included in the Ponsse Group are Ponsse AB, Sweden; Ponsse AS,
Norway; Ponssé S.A.S., France; Ponsse UK Ltd, the United Kingdom; Ponsse
Machines Ireland Ltd, Ireland, Ponsse North America, Inc., the United States;
Ponsse Latin America Ltda, Brazil; Ponsse Uruguay S.A., Uruguay; OOO Ponsse,
Russia; Ponsse Asia-Pacific Ltd, Hong Kong; Ponsse China Ltd, China; Ponsse
Chile SpA, Chile (as of 4 November 2021) and Epec Oy, Finland. The Group
includes also the OOO Ponsse wholly-owned property company Ponsse Centre in
Russia and Sunit Oy in Finland, which is Ponsse Plc’s associate with a holding
of 34 per cent.
R&D AND CAPITAL EXPENDITURE
Group’s R&D expenses during the period under review totalled EUR 23.8 (21.3)
million, of which EUR 9.2 (9.2) million was capitalised.
Capital expenditure totalled EUR 24.9 (20.3) million. It consisted in addition
to capitalised R&D expenses of investments in buildings and ordinary maintenance
and replacement investments for machinery and equipment.
ANNUAL GENERAL MEETING
Annual General Meeting was held in Vieremä, Finland 7 April 2021. The AGM
approved the parent company financial statements and the consolidated financial
statements, and members of the Board of Directors and the President and CEO were
discharged from liability for the 2020 financial period.
The AGM decided to pay a dividend of EUR 0.60 per share for 2020 (dividends
totaling EUR 16,800,000). The dividend payment record date was 9 April 2021, and
the dividends were paid on 16 April 2021.
Annual General Meeting authorised the Board of Directors to decide on the
acquisition of treasury shares so that a maximum of 250,000 shares can be
acquired in one or several instalments. The maximum amount corresponds to
approximately 0.89 per cent of the company’s total shares and votes.
The shares will be acquired in public trading organised by Nasdaq Helsinki (“the
Stock Exchange”). Furthermore, they will be acquired and paid according to the
rules of the Stock Exchange and Euroclear Finland Ltd.
The Board may, pursuant to the authorisation, only decide upon the acquisition
of the treasury shares using the company’s unrestricted shareholders’ equity.
The authorisation is required to support the company’s growth strategy and for
use in the company's potential corporate acquisitions or other arrangements. In
addition, shares can be distributed to the company’s current shareholders, used
for increasing shareholders’ ownership value by invalidating shares after their
acquisition or used in personnel incentive systems. The authorisation includes
the right of the Board to decide upon all other terms and conditions in the
acquisition of treasury shares.
The authorisation is valid until the next Annual General Meeting; however, no
later than 30 June 2022. The previous authorisations are cancelled.
The AGM authorised the Board of Directors to decide on the assignment of
treasury shares held by the company in one or more tranches for payment or
without payment so that a maximum of 250,000 shares will be issued on the basis
of the authorisation. The maximum amount corresponds to approximately 0.89 per
cent of the company’s total shares and votes.
The authorisation includes the right of the Board to decide upon all other terms
and conditions of the share issue. Thus, the authorisation includes the right to
organise a special issue in deviation of the shareholders' subscription rights
under the conditions prescribed by law.
The authorisation is used in supporting the company’s growth strategy in the
company's potential corporate acquisitions or other arrangements. In addition,
the shares can be issued to the company’s current shareholders, sold through
public trading or used in personnel incentive systems. A directed share issue
may only be free of charge if there is a particularly weighty economic reason
for this considering the company, taking into account the interests of the
company and all of its shareholders.
The authorisation is valid until the next Annual General Meeting; however, no
later than 30 June 2022. The previous authorisations are cancelled.
Annual General Meeting authorised the Board of Directors to decide on a directed
share issue and to issue special rights entitling to shares as referred to in
Section 10(1) of the Finnish Limited Liability Companies Act, in one or more
tranches, for payment or without a payment.
Based on the authorisation, a maximum of 200,000 shares can be issued, which is
approximately 0.7 per cent of the current total number of shares in the company.
Shares can be issued as part of the company’s share-based incentive plans. The
Board of Directors will decide on all the terms and conditions for the granting
of special rights entitling to shares in the share issue. Based on the
authorisation, a derogation from the pre-emptive subscription right of
shareholders (directed issue) may be granted for the special rights entitling to
shares. A directed issue may only be free of charge if there is a particularly
weighty economic reason for this considering the company, taking into account
the interests of the company and all of its shareholders.
The authorisation is valid until the next Annual General Meeting, however no
later than 30 June 2022.
BOARD OF DIRECTORS AND THE COMPANY’S AUDITORS
Jarmo Vidgrén acted as Chairman of the Board and Mammu Kaario as Vice Chairman
of the Board. Members of the Board were Matti Kylävainio, Juha Vanhainen, Janne
Vidgrén, Juha Vidgrén and Jukka Vidgrén.
The Board of Directors did not establish any committees or commissions from
among its members.
The Board of Directors convened eleven times during the period under review. The
attendance rate was 97.4 percent.
During the period under review, KPMG Oy Ab acted as the company auditor with Ari
Eskelinen, Authorised Public Accountant, as the principal auditor.
MANAGEMENT
The following persons were members of the Management Team: Juho Nummela,
President and CEO, acting as the chairman; Petri Härkönen, Deputy CEO, CFO; Juha
Inberg, Technology and R&D Director; Marko Mattila, Sales and Marketing
Director; Tapio Mertanen, Service Director; Paula Oksman, HR Director; Miika
Soininen, Director of IT and Digital Services and Tommi Väänänen, Director of
Delivery Chain Process. The company management has regular management liability
insurance.
The area director organisation of sales is led by Marko Mattila, the Group's
sales and marketing director, and Tapio Mertanen, service director. Area
directors report to Jussi Hentunen, Ponsse retail network manager. Managing
directors of subsidiaries and Jussi Hentunen report to Marko Mattila, Ponsse
Plc's sales and marketing director.
The geographical distribution and the responsible persons are presented below:
Northern Europe:
Jani Liukkonen (Finland),
Carl-Henrik Hammar (Sweden, Denmark and Norway) and
Tarmo Saks (the Baltic countries).
Central and Southern Europe:
Tuomo Moilanen (Germany and Austria),
Clément Puybaret (France),
Janne Tarvainen (Spain and Portugal),
Gary Glendinning (Hungary, Romania, Slovenia, Croatia and Serbia until 28
February 2021; United Kingdom and Ireland),
Antti Räsänen (Hungary, Italy, Romania, Slovenia, Croatia, Serbia and Bulgaria
starting 1 March 2021) and
Tarmo Saks (Poland, Czech Republic and Slovakia).
Russia and Asia:
Jaakko Laurila (Russia and Belarus),
Janne Tarvainen (Australia and South Africa) and
Risto Kääriäinen (China and Japan).
North and South America:
Pekka Ruuskanen (the United States),
Eero Lukkarinen (Canada),
Fernando Campos (Brazil) and
Martin Toledo (Uruguay, Chile and Argentina).
PERSONNEL
The Group had an average staff of 1,954 (1,782) during the period and employed
2,072 (1,845) people at period-end.
SHARE PERFORMANCE
The company’s registered share capital consists of 28,000,000 shares. The
trading volume of Ponsse Plc shares for 1 January – 31 December 2021 totalled
1,351,899, accounting for 4.8 per cent of the total number of shares. Share
turnover amounted to EUR 54.4 million, with the period’s lowest and highest
share prices amounting to EUR 29.15 and EUR 48.8, respectively.
At the end of the period, shares closed at EUR 42.20, and market capitalisation
totalled EUR 1,181.6 million.
At the end of the period under review, the company held 227 treasury shares.
CERTIFIED MANAGEMENT SYSTEMS
Ponsse Plc is committed to observing the following standards: ISO 9001 for
quality management systems, ISO 14001 for environmental management systems, and
ISO 45001 for occupational health and safety management systems. The purpose of
management systems is to standardise our group’s operations and ensure our
company’s continuous development.
Our management systems were audited by LRQA in 2021, and we also carried out a
statutory compliance audit of our production. Internal audits mandated by our
operating processes were carried out in the group according to the normal audit
programme. Due to the COVID-19 pandemic, only select critical audits were
performed in our supplier network.
Ponsse Uruguay S.A, part of Ponsse Group, has been ISO 9001 and ISO 45001
certified since 2020. Ponsse Latin America Ltda, our Brazilian subsidiary, was
ISO 9001 certified in 2021. Ponsse’s Finnish subsidiary Epec Oy was awarded ISO
27001 certification for its information security management system in 2021. Epec
develops and produces Ponsse data system solutions. Epec Oy also has the
following certifications: ISO 9001 for quality management systems, ISO 14001 for
environmental management systems, and ISO 45001 for occupational health and
safety management systems.
SUSTAINABLE DEVELOPMENT
Our management systems steer the implementation of Ponsse’s sustainable
development principles and responsible leadership. At Ponsse, sustainable
development means taking the economic, social and ecological points of view and
the principles related to them equally into account in the company's operations.
According to the point of view of ecological sustainability we want to avoid and
minimise the negative impacts of our products, services, operations and
decisions on biodiversity, the ecosystem and sufficiency of natural resources.
We evaluate the lifetime environmental impacts of our products according to the
life cycle assessment specified in ISO 14040. Our investments in minimising the
fuel consumption and emissions of our products, as well as the damage they can
cause to trees and the soil, and the continuous development of our service
processes also influence the sustainability of our customers’ operations.
To maintain social sustainability, we ensure people's occupational health and
safety, exercise equal and fair treatment, and support employment and the
development of a skilled workforce.
In economical sustainability, we focus on profitability, cash flow from business
operations, and growth to ensure our company’s financial performance in the long
term. This brings stability and continuity to local communities and society all
across our global field of operations.
GOVERNANCE
In its decision-making and administration, the company observes the Finnish
Limited Liability Companies Act, other regulations governing publicly listed
companies and the company’s Articles of Association. The company’s Board of
Directors has adopted the Code of Governance that complies with the Finnish
Corporate Governance Code approved by the Board of the Securities Market
Association. The purpose of the code is to ensure that the company is
professionally managed and that its business principles and practices are of a
high ethical and professional standard.
The Code of Governance is available on Ponsse’s website in the Investors
section.
NON-FINANCIAL INFORMATION REPORTING
The non-financial information reporting is available at the annual report, in
section Corporate social responsibility and also on Ponsse’s website in the
Investors section.
RISK MANAGEMENT
Risk management is based on the company’s values, as well as strategic and
financial objectives. Risk management aims to support the achievement of the
objectives specified in the company’s strategy, as well as to ensure the
financial development of the company and the continuity of its business.
Furthermore, risk management aims to identify, assess and monitor business
-related risks which may influence the achievement of the company’s strategic
and financial goals or the continuity of its business. Decisions on the
necessary measures to anticipate risks and react to observed risks are made on
the basis of this information.
Risk management is a part of regular daily business, and it is also included in
the management system. Risk management is controlled by the risk management
policy approved by the Board.
A risk is any event that may prevent the company from reaching its objectives or
that threatens the continuity of business. On the other hand, a risk may also be
a positive event, in which case the risk is treated as an opportunity. Each risk
is assessed on the basis of its impact and probability. Methods of risk
management include avoiding, mitigating and transferring risks. Risks can also
be managed by controlling and minimising their impact.
SHORT-TERM RISK MANAGEMENT
The insecurity in the world economy may result in a decline in the demand for
forest machines and the availability of components. The unexpectedly swift
recovery of the world economy and rapid growth in demand have resulted in
availability problems in certain component groups. The quick economic
fluctuation may affect availability, but also cause rapid inflation in the
component market. The uncertainty may also be increased by the volatility of
developing countries’ foreign exchange markets. The geopolitical situation, in
particular, will increase the uncertainty through financial market operations
and sanctions. Changes taking place in the fiscal and customs legislation in
countries to which Ponsse exports may hamper the company’s export trade or its
profitability.
The effects of the Covid-19 pandemic are described in section “IMPACT OF THE
COVID-19 PANDEMIC” of this release.
The parent company monitors the changes in the Group’s internal and external
trade receivables and the associated risk of impairment.
The key objective of the company’s financial risk management policy is to manage
liquidity, interest and currency risks. The company ensures its liquidity
through credit limit facilities agreed with a number of financial institutions.
The effect of adverse changes in interest rates is minimised by utilising credit
linked to different reference rates and by concluding interest rate swaps. The
effects of currency rate fluctuations are partly mitigated through derivative
contracts.
Accounting policies requiring consideration by management and crucial factors of
uncertainty associated with estimates
Estimates and assumptions regarding the future have to be made during the
preparation of the financial statements, and the outcome may differ from the
estimates and assumptions. Group management utilises their best judgement when
making decisions regarding accounting policies and their adoption. Estimates
made when compiling the financial statements are based on the management’s best
views on the closing date of the reporting period. The estimates are based on
previous experience and assumptions about the future that are deemed the most
likely on the balance sheet date.
Trade receivables
On the date of the financial statements, the Group recognises a credit loss on
receivables for which no payment will probably be received according to its best
judgement. The general model specified in IFRS 9 is applied when recognising
provision for expected credit losses.
Inventories
On the date of the financial statements, the Group recognises impairment losses
according to its best judgement. The assessment takes into account the age
structure of the inventory and the likely selling price.
Change in guarantee provision
The guarantee provision is based on realised guarantee expenses and on failure
history recorded in the previous years. In addition, company may prepare
provision for possible individual warranty obligations, if needed.
Capitalisation of R&D expenditure
On the date of the financial statements, the Group assesses whether the new
product is technically feasible, whether it can be commercially utilised and
whether future economic benefits will be received from the product, which makes
it possible to capitalise development expenditure arising from the design of new
or advanced products on the balance sheet as intangible assets.
Accounting of configuration or customisation costs in a cloud computing
arrangement
In April 2021, the IFRS Interpretations Committee published its final agenda
decision on the accounting of configuration or customisation costs in a cloud
computing arrangement (IAS 38 Intangible Assets). In this agenda decision, the
Interpretations Committee determined when an intangible asset in relation to the
configuration or customisation of application software can be recognized. IFRIC
agenda decisions have no date when they enter into force, and they are expected
to be applied as soon as possible.
Because the Group uses cloud computing arrangements, it has analysed the impact
on the accounting principles applied to the deployment costs of cloud services.
Based on this analysis, it was concluded that the IFRIC agenda decision has an
impact on the earlier accounting treatment related to costs in cloud computing
arrangements. As a result of the analysis, Group has expensed cloud computing
related costs which clearly do not give rise to an intangible asset. This
recognition has an EUR 0.2 million impact on the fourth quarter result. The
analysis will be continued during 2022 for items under consideration recorded in
advance payments (EUR 0.4 million) in order to confirm the final accounting
treatment.
EVENTS AFTER THE PERIOD
Ponsse Group will be independently responsible for its sales, spare parts and
maintenance services in the Czech Republic. On 4 February 2022, Ponsse signed a
deed of sale, in which it agrees to purchase all shares in KŘENEK FOREST SERVICE
s.r.o, its PONSSE forest machine and service dealer in the Czech Republic. The
aim is that PONSSE services in the Czech Republic will transfer to Ponsse Group
by 1 April 2022. The company will operate as a subsidiary wholly owned by
Ponsse.
OUTLOOK FOR THE FUTURE
Group´s euro-denominated operating result in 2022 is estimated to be on a par
with 2021.
Sustainable solutions to address the availability of parts and components, as
well as increasing costs, are being sought in cooperation with the supplier
network. High rate of infections caused by the covid-19 pandemic can cause
significant challenges to supplier network and Ponsse’s own operations. The
company will continue its enhanced cost control and careful investment
execution.
ANNUAL GENERAL MEETING
Ponsse Plc’s Annual General Meeting will be held on 7 April 2022, starting at
11:00 a.m. at the place and in a way to be announced later.

BOARD OF DIRECTORS’ PROPOSAL FOR THE DISPOSAL OF PROFIT
The parent company Ponsse Plc had 185,322,440.64 euros of distributable funds on
31 December 2021.
The company’s Board of Directors proposes to the Annual General Meeting that a
dividend of EUR 0.85 per share shall be paid for the year 2021. The company’s
Board of Directors proposes to the Annual General Meeting that a profit bonus of
at most EUR 100 per person per working month be paid for 2021 to the personnel
employed by the Group.
PONSSE GROUP
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (EUR 1,000)

                     IFRS      IFRS
                     1-12/21   1-12/20

NET SALES 749,998 636,627
Increase 12,502 -6,424
(+)/decrease (-) in
inventories of
finished goods and
work in progress
Other operating 3,573 3,521
income
Raw materials and -499,351 -418,400
services
Expenditure on -102,835 -85,726
employment-related
benefits
Depreciation and -25,251 -24,631
amortisation
Other operating -63,615 -47,821
expenses
OPERATING RESULT 75,021 57,146
Share of results of 19 86
associated companies
Financial income and -1,836 -17,671
expenses
RESULT BEFORE TAXES 73,204 39,561
Income taxes -18,131 -7,277
NET RESULT FOR THE 55,073 32,284
PERIOD

OTHER ITEMS INCLUDED
IN TOTAL
COMPREHENSIVE
RESULT:
Translation 3,916 -968
differences related
to foreign units

TOTAL COMPREHENSIVE 58,989 31,316
RESULT FOR THE
PERIOD

Diluted and 1.97 1.15
undiluted earnings
per share*

                     IFRS      IFRS
                     10-12/21  10-12/20

NET SALES 226,569 205,202
Increase -8,406 -28,979
(+)/decrease (-) in
inventories of
finished goods and
work in progress
Other operating 1,479 2,195
income
Raw materials and -142,209 -119,749
services
Expenditure on -30,510 -24,765
employment-related
benefits
Depreciation and -6,875 -5,895
amortisation
Other operating -21,299 -14,301
expenses
OPERATING RESULT 18,748 13,708
Share of results of -20 168
associated companies
Financial income and -197 2,965
expenses
RESULT BEFORE TAXES 18,530 16,841
Income taxes -2,670 796
NET RESULT FOR THE 15,861 17,637
PERIOD

OTHER ITEMS INCLUDED
IN TOTAL
COMPREHENSIVE
RESULT:
Translation 490 -2,545
differences related
to foreign units

TOTAL COMPREHENSIVE 16,350 15,092
RESULT FOR THE
PERIOD

Diluted and 0.57 0.63
undiluted earnings
per share*

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (EUR 1,000)

                                           IFRS       IFRS

ASSETS 31 Dec 21 31 Dec 20
NON-CURRENT ASSETS
Intangible assets 42,087 36,709
Goodwill 3,801 3,808
Property, plant and equipment 112,127 112,183
Financial assets 373 371
Investments in associated companies 785 832
Non-current receivables 173 839
Deferred tax assets 3,360 3,076
TOTAL NON-CURRENT ASSETS 162,706 157,818

CURRENT ASSETS
Inventories 167,414 142,137
Trade receivables 43,394 35,384
Income tax receivables 938 1,849
Other current receivables 17,270 13,165
Cash and cash equivalents 120,900 123,611
TOTAL CURRENT ASSETS 349,916 316,146

TOTAL ASSETS 512,622 473,964

SHAREHOLDERS’ EQUITY AND LIABILITIES
SHAREHOLDERS’ EQUITY
Share capital 7,000 7,000
Other reserves 3,460 3,460
Translation differences 8,347 4,431
Treasury shares -2 -2
Retained earnings 278,462 240,149
EQUITY OWNED BY PARENT COMPANY SHAREHOLDERS 297,267 255,038

NON-CURRENT LIABILITIES
Interest-bearing liabilities 49,851 50,470
Deferred tax liabilities 967 1,137
Other non-current liabilities 87 41
TOTAL NON-CURRENT LIABILITIES 50,905 51,648

CURRENT LIABILITIES
Interest-bearing liabilities 4,945 64,055
Provisions 4,550 4,979
Tax liabilities for the period 901 1,312
Trade creditors and other current liabilities 154,054 96,932
TOTAL CURRENT LIABILITIES 164,450 167,278

TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES 512,622 473,964

CONSOLIDATED STATEMENT OF CASH FLOWS (EUR 1,000)

                                                  IFRS     IFRS
                                                  1-12/21  1-12/20

CASH FLOWS FROM OPERATING ACTIVITIES:
Net result for the period 55,073 32,284
Adjustments:
Financial income and expenses 1,836 17,671
Share of the result of associated companies -19 -86
Depreciation and amortisation 25,251 24,631
Income taxes 18,131 7,277
Other adjustments -1,016 -58
Cash flow before changes in working capital 99,256 81,719

Change in working capital:
Change in trade receivables and other receivables -12,835 9,454
Change in inventories -22,371 1,965
Change in trade creditors and other liabilities 57,525 -5,743
Change in provisions for liabilities and charges -429 1,529
Interest received 190 97
Interest paid -1,062 -1,068
Other financial items 279 -3,100
Income taxes paid -18,126 -10,063
NET CASH FLOWS FROM OPERATING ACTIVITIES (A) 102,429 74,790

CASH FLOWS USED IN INVESTING ACTIVITIES
Investments in tangible and intangible assets -24,856 -20,270
Proceeds from sale of tangible and intangible assets 776 254
NET CASH FLOWS USED IN INVESTMENT ACTIVITIES (B) -24,080 -20,016

CASH FLOWS FROM FINANCING ACTIVITIES
Withdrawal/Repayment of current loans -61,031 28,680
Withdrawal/Repayment of finance lease liabilities -3,113 -1,268
Dividends paid -16,800 -8,400
NET CASH FLOWS FROM FINANCING ACTIVITIES (C) -80,943 19,012

Change in cash and cash equivalents (A+B+C) -2,594 73,786

Cash and cash equivalents on 1 Jan 123,611 48,704
Impact of exchange rate changes -116 1,121
Cash and cash equivalents on 31 Dec 120,900 123,611

*) The company has made a retrospective change in comparison period between
items Other adjustments, Income taxes paid and Change in trade creditors and
other liabilities. The change had no effect on Net cash flows from operating
activities (A).

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (EUR 1,000)

A = Share capital
B = Share premium
and other reserves
C = Translation
differences
D = Treasury shares
E = Retained
earnings
F = Total
shareholders’ equity

                  EQUITY OWNED
                  BY PARENT
                  COMPANY
                  SHAREHOLDERS
                  A         B      C         D       E        F

SHAREHOLDERS’ EQUITY 7,000 3,460 4,431 -2 240,149 255,038
  1 JAN 2021
Translation 3,916 3,916
differences
Result for the 55,073 55,073
period
Total comprehensive 3,916 55,073 58,989
income for the
period
Direct entries to 7 7
retained earnings
Share Plan 33 33
Dividend -16,800 -16,800
distribution
SHAREHOLDERS' EQUITY 7,000 3,460 8,347 -2 278,462 297,267
31 DEC 2021

SHAREHOLDERS’ 7,000 3,460 5,399 -2 216,264 232,121
EQUITY   1 JAN 2020
Translation -968 -968
differences
Result for the 32,284 32,284
period
Total comprehensive -968 32,284 31,316
income for the
period
Dividend -8,400 -8,400
distribution
SHAREHOLDERS' EQUITY 7,000 3,460 4,431 -2 240,149 255,038
31 DEC 2020

31 31
Dec Dec
21 20
1. LEASING 751 595
COMMITMENTS (EUR
1,000)
2. CONTINGENT 31 31
LIABILITIES (EUR Dec Dec
1,000) 21 20
Guarantees given on 20 20
behalf of others
Responsibility of 7,272 7,863
checking the VAT
deductions made on
real property
investments
Other commitments 112 14
TOTAL 7,404 7,897
3. PROVISIONS (EUR Guarantee
1,000) provision
1 January 2021 4,979
Provisions added 956
Provisions cancelled -1,384

31 December 2021 4,550

KEY FIGURES AND 31 31
RATIOS Dec Dec
21 20
R&D expenditure, 23.8 21.3
MEUR
Capital expenditure, 24.9 20.3
MEUR
as % of net sales 3.3 3.2
Average number of 1,954 1,782
employees
Order books, MEUR 439.8 174.9
Equity ratio, % 60.7 54.3
Diluted and 1.97 1.15
undiluted earnings
per share (EUR)
Equity per share 10.62 9.11
(EUR)

FORMULAE FOR FINANCIAL INDICATORS
Return on capital employed, %:
Result before taxes + financial expenses

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Shareholder´s equity + interest-bearing financial liabilities (average during
the year) * 100
Average number of employees:
Average of the number of personnel at the end of each month. The calculation has
been adjusted for part-time employees.
Net gearing, %:
Interest-bearing financial liabilities – cash and cash equivalents

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---

Shareholders’ equity * 100
Equity ratio, %:
Shareholders’ equity + Non-controlling interests

---

Balance sheet total - advance payments received * 100
Earnings per share:
Net result for the period - Non-controlling interests

---

---

Average number of shares during the accounting period, adjusted for share issues
Equity per share:
Shareholders’ equity

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---

Number of shares on the balance sheet date, adjusted for share issues

ORDER INTAKE (EUR million) 1-12/21 1-12/20
Ponsse Group 1,019.6 581.7

The stock exchange release for the annual financial statements has been prepared
observing the recognition and valuation principles of IFRS, and the requirements
of IAS 34 have been complied with. The same accounting principles were observed
for the closing of the books as for the annual financial statements dated 31
December 2020.
The above figures have not been audited.
The above figures have been rounded and may therefore differ from those given in
the official financial statements.
This communication includes future-oriented statements that are based on the
assumptions currently made by the company’s management and its current decisions
and plans. Although the management believes that the future expectations are
well founded, there is no certainty that these expectations will prove to be
correct. This is why the results may significantly deviate from the assumptions
included in the future-oriented statements as a result of, among other things,
changes in the economy, markets, competitive conditions, legislation or currency
exchange rates.
Vieremä, 22 February 2022
PONSSE PLC
Juho Nummela
President and CEO
FURTHER INFORMATION
Juho Nummela, President and CEO, tel. +358 400 495 690
Petri Härkönen, CFO, tel. +358 50 409 8362
DISTRIBUTION
NASDAQ OMX Helsinki Ltd
Principal media
www.ponsse.com
Ponsse Plc is a company specialising in the sales, manufacture, servicing and
technology of cut-to-length method forest machines and is driven by genuine
interest in its customers and their business. Ponsse develops and manufactures
sustainable and innovative harvesting solutions based on customers’ needs.
The company was established by forest machine entrepreneur Einari Vidgrén in
1970, and it has been a leader in timber harvesting solutions based on the cut
-to-length method ever since. Ponsse is headquartered in Vieremä, Finland. The
company’s shares are quoted on the NASDAQ OMX Nordic List.

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