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Studsvik — Interim / Quarterly Report 2007
Feb 14, 2008
3208_10-k_2008-02-14_c57bc942-3928-4da8-9c94-d30bfe9a9a0f.pdf
Interim / Quarterly Report
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| Full Year 2007 | Full year 2006 | ||
|---|---|---|---|
| Net sales, SEK million | 1,314.7 | 1,219.6 | |
| Operating profi t, SEK million | 62.1 | 71.3 | |
| Profi t after tax, SEK million | 47.2 | 34.8 | |
| Profi t per share after tax, SEK | 5.65 | 4.24 | |
| Equity per share, SEK | 69.58 | 67.97 | |
| Equity-assets ratio, % | 42.5 | 41.2 |
Interim Report January –December 2007
- High growth net sales up by 18 per cent. •
- Sustained strong growth in the UK. •
- Well fi lled order books in most segments at end of 2007. •
- Group facility for treatment of metallic waste in the UK received environmental and nuclear permits. •
- Contract signed with WCS for storage of nuclear waste strengthens Studsvik's market position in the USA. •
- The target for organic growth is being raised from 5 to 10 per cent. •
- Market developments will create an environment favorable to healthy organic growth in most segments 2008. •
- The Board of Directors proposes a dividend of SEK 2.00 per share. •
Net Sales
Net sales for the fourth quarter amounted to SEK 370.6 million (329.2). For comparable entities, net sales increased by SEK 76.5 million, equivalent to 26 per cent. The increase is mainly attributable to the operations in the United Kingdom. Net sales for the period of January to December amounted to SEK 1,314.7 million (1,219.6). For comparable entities, net sales increased by SEK 191.8 million, equivalent to 18 per cent. All segments contributed to the increase. The foreign exchange effects on translation of foreign subsidiaries' net sales amounted to SEK –44.9 million.
Sales abroad amounted to 80 (72) per cent of net sales.
Profi t
The operating profi t for the fourth quarter amounted to SEK 15.3 million (21.2). For comparable entities, the operating profi t decreased by SEK 3.4 million. The operating profi t for the period of January to December amounted to SEK 62.1 million (71.3). For comparable entities and after adjustment for capital gains on the sale of Studsvik Stensand and costs associated with the discontinued acquisition process in the United Kingdom in the second quarter, the operating profi t decreased by SEK 12.1 million. Foreign exchange effects in connection with the translation of
foreign subsidiaries' operating profi t amounted to SEK –0.6 million (–0.5).
Operating Segments
The Group's business was in 2007 conducted through four Strategic Business Areas: Waste Treatment, Decommissioning, Service and Maintenance, and Operating Effi ciency. Since January 1, 2008, the business has been conducted through fi ve operating segments. This new structure will sharpen the organization's focus on specifi c markets, while also creating a more informative picture of the Group's business and development. The Group's new segment structure is geographical and consists of fi ve operating segments; Sweden, United Kingdom, Germany, USA and Global Services.
The former division into Strategic Business Areas has been abolished, although the names remain, in somewhat modifi ed form, as a unifying presentation of the Group's customer offering. Service and Maintenance's name is being changed to Engineering & Services in order to better refl ect the growing importance of consulting services.
In order to correspond more closely to the new operative organization, Studsvik's business is presented in this report in accordance with the new structure. For purposes of comparison, the information is also provided in accordance with the previous structure. The new segment structure is available on the Group's website – www.studsvik.se – together with comparative fi gures for all quarters in 2006 and 2007.
Sweden
This segment comprises Waste Treatment performed in the Group's facilities in Sweden. The segment serves customers in Europe. The great majority of the customers are in Sweden, Germany and neighboring countries, and the United Kingdom.
Net sales for the fourth quarter amounted to SEK 43.6 million (36.0) and for the period of January to December, to SEK 135.4 million (126.2). The operating profi t for the fourth quarter amounted to SEK 13.5 million (12.3) and for the period of January to December to SEK 28.2 million (26.3). The segment made a strong recovery in the fourth quarter in terms of both volume and result. Processing of large components and other metallic waste, which was adversely affected by technical disturbances to production during the third quarter, ended the year with a high level of production and healthy profi tability. Studsvik's technology for the treatment of large components moved into its commercialization phase during the year when delivery was taken of six steam generators. The method used for treatment of large components weighing
between 200 and 600 tonnes has been successively improved and the lead time for a component has been shortened from the original twelve months to four. Production in the incineration unit was high during the fourth quarter, but slightly lower in 2007 than in the previous year. Both the incineration activities and the treatment of metallic waste entered 2008 with healthy order books. All facilities have the capacity to increase the volumes treated.
United Kingdom
This segment comprises the business conducted within Waste Treatment and Decommissioning in the United Kingdom.
Net sales for the fourth quarter amounted to SEK 38.9 million (13.9) and for the period of January to December, to SEK 129.1 million (30.9). The operating profi t for the fourth quarter amounted to SEK 0.9 million (–2.5) and for the period of January to December to SEK 3.0 million (–11.3). The business developed very well during the year and after two years in the build-up phase, Studsvik has established a strong position on the UK market. In 2007 the Decommissioning acti vities tended to predominate, but Waste Treatment gradually assumed greater importance. The result improved during the fourth quarter in relation to the corresponding period in 2006 in both Decommissioning and Waste Treatment. Studsvik Alpha Engineering, which was acquired during the third quarter, has performed in line with our expectations, and reported a healthy cash fl ow. As the acquired order book of SEK 3 million is being written off over 12 months, the contribution to the consolidated operating profi t was only marginal. A consortium, Nuclear Waste Management (NWM), in which Studsvik has a minority interest, has been selected as the preferred bidder to manage the UK Low Level Waste Repository. Studsvik has a 15 per cent interest in the consortium. The contract, currently under negotiation, has an initial term of fi ve years with further extensions up to a total of 17 years. The initial contract value is estimated to be GBP 125 million. If all the contract extension options are executed, the potential contract value could be increased to GBP 500 million. Included in the initial contract is the development of a UK-wide low level waste strategy. After the close of the reporting period Studsvik received environmental and nuclear permits to treat metallic waste at the Group's facility in Workington.
Germany
This segment comprises the business conducted in Germany and neighboring countries within Decommissioning and Engineering & Services.
Net sales for the fourth quarter amounted to SEK 84.6 million (81.2) and for the period of January to December, to SEK 341.3 milli on (308.7). The operating profi t for the fourth quarter amounted to SEK 4.1 million (4.4) and for the period of January to December, to SEK 25.3 million (25.8). The number of refueling and outage days in the German nuclear power industry was substantially higher in 2007 than in previous year. The capacity utilization in Engineering & Services was high well into the fourth quarter. The acquired consulting business Dr. Fary developed well, and the business has grown organically since the acquisition. The level of activity on the decommissioning market in Germany was lower also during the fourth quarter than in the previous year, although there was a slight recovery towards the end of the period.
USA
This segment comprises the Waste Treatment business carried out at the Group's facilities in the USA. The great majority of the customers are at present located in the USA, but the segment also canvasses the Canadian market.
Net sales for the fourth quarter amounted to SEK 94.3 million (106.6) and for the period of January to December, to SEK 427.7 million (364.3). Some SEK 50 million of the increase is attributable to the business in Memphis, which was acquired in 2006 and consolidated from May of that year. The operating profi t for the fourth quarter amounted to SEK –4.6 million (–5.7) and for the period of January to December, to SEK 6.3 million (11.4). The opera tions in Erwin made further good progress during the fourth quarter. A healthy level of capacity utilization and robust pricing for processed material helped the business, despite some production disturbances at the beginning of the year, to report its best annual result ever. The Barnwell repository for low and intermediate level radio active waste in the USA will, as far as can be judged, be closed at the end of June 2008. In practice this means that most American nuclear power plants will lack access to fi nal storage for their intermediate level radioactive waste, including ion-exchange resins that are processed at the Erwin facility. The co-operation agreement that was signed with Waste Control Specialists, Texas, during the third quarter, will likely enable Studsvik to offer the American nuclear power industry a competitive storage solution after Barnwell has been closed.
In the fourth quarter, the Memphis operations – waste treatment and logistical services – noted another quarter of low profi t ability. The year was characterized by fi erce competition and depressed prices. Consequently, higher costs were incurred on defending the market position. Investments were made during the year in the Memphis facility in order to raise its capacity to process large components. The Erwin operations ended 2007 with a good backlog while the backlog for the Memphis operations is weak.
During the fourth quarter, THOR Treatment Technologies received an order worth MUSD 7.5 from the US Department of Energy to demonstrate, during the 22 months duration of the order, that the THOR technology can be applied to high level radioactive waste. TTT reported a profi t and a positive cash fl ow for 2007.
Global Services
This segment comprises the business that is conducted within the Operating Effi ciency business area, namely the activities in materials technology and fuel optimization software. As the customer base is global, the segment is engaged in business in many countries.
Net sales for the fourth quarter amounted to SEK 52.8 milli on (43.7) and for the period of January to December, to SEK 178.8 million (167.7). The operating profi t for the fourth quarter amounted to SEK 8.8 (17.4) and for the period of January to December, to SEK 14.4 million (36.4). Fuel optimization software made encouraging progress in 2007 with robust growth in both net sales and operating profi t. The year ended strongly with a large software delivery to Mitsubishi Heavy Industries (MHI) during the fourth quarter. MHI selected Studsvik's software to be used in the development of new reactor designs. Materials technology had another weak period during the fourth quarter largely due to low capacity utilization in some areas of the business. The order intake and the capacity situation improved towards the end of the quarter. During the year a development project was carried out to qualify the Norwegian materials testing reactor in Halden for ramp tests, and in December the fi rst tests were successfully completed, which marked a milestone in the co-operation between Studsvik and the Norwegian Institute for Energy Technology. Ramp tests are carried out on reactor fuel and are normally combined with laboratory tests in Hot Cells. Studsvik can now offer a complete range of tests and analyses for reactor fuel, which has not been possible since the closure of the company's own materials testing reactor in 2005.
Investments
The Group's investments in 2007 amounted to SEK 127.3 million (344.7) and in the fourth quarter to SEK 25.4 million (28.3). The fi gure for the year includes investments of SEK 46.2 million in acqui sitions of companies and lines of business. Expansion investments, over and above these, mainly consist of SEK 29.7 million for the extension of the waste treatment facility in Sweden and of SEK 10.2 for the waste treatment facility in Memphis. Other investments were mainly in the form of reinvestment projects.
Financial Position and Liquidity
Cash and cash equivalents, including current investments, amounted to SEK 176.9 million (247.6).
Equity amounted to SEK 571.8 million (558.7).
The equity-assets ratio was 42.5 (41.2) per cent. Interestbearing liabilities amounted to SEK 318.7 million (347.2). The Group's total borrowings was conducted entirely in foreign curren cies and relates to investments and business acquisitions in the USA, Germany and the United Kingdom.
Cash Flow
Cash fl ow from operating activities before working capital changes amounted to SEK 76.7 million (105.5). Changes in working capital amounted to SEK –37.7 million (–1.4). Cash fl ow from operating activities after investments amounted to SEK –83.4 million (–240.6). Other changes from investing activities, SEK 47.0 million, relate to the sale of Studsvik Stensand AB on January 1.
Financial Targets
The Board of Directors has reviewed the Group's fi nancial targets and has decided to raise the target for organic growth to 10 per cent as a yearly average during a three year period. The target for the operating margin will remain unchanged at 8 per cent and the target for the equity-assets ratio till be no lower than 40 per cent.
Personnel
The average number of employees during 2007 was 1,141 (1,279).
Parent Company
The Parent company's operations comprise coordination of the Group, and assets mainly consist of shares in subsidiaries. The Parent Company's net sales for the year amounted to SEK 5.6 million (8.0) and for the fourth quarter, to SEK 1.5 million (2.0). The year's operating profi t amounted to SEK –38.3 million (–27.3) and for the fourth quarter, to SEK –8.1 million (–7.4). The result for the year as a whole includes capital gains of SEK 35.0 million on the sale of Studsvik Stensand AB and costs associated with the discontinued acquisition process in the UK, MSEK 10.5. Profi t after net fi nancial items amounted to SEK –2.6 million (–1.3). The Parent Company's investments amounted to SEK 0.5 million (2.3). Cash and cash equivalents amounted to SEK 91.2 million (149.7) and interest-bearing liabilities to SEK 154.2 million (182.9).
Dividend, Annual General Meeting and Annual Report
The Board proposes that a dividend of SEK 2.00 (2.00) per share should be paid for the 2007 fi nancial year. The Annual General Meeting of Shareholders will be held at 4.00 pm on Tuesday April 22, 2008 in the World Trade Center, Klarabergsviadukten 70/Kungsbron 1, Stockholm. The Annual Report will be distributed and made available on the company's website in the week beginning March 31, 2008.
Risks and Uncertainties
Studsvik operates on an international market that is exposed to competition. With operations in seven countries Studsvik is exposed to both business and fi nancial risks and uncertainties. The business uncertainties include the fact that Studsvik handles radioactive material and waste, which means that some of the operations must be licensed and are subject to decisions by govern ment agencies, offi cial regulations and supervision. Studsvik considers that it fulfi ls the requirements imposed by such regulations. The Group's high security culture means that it has a high capacity for adjustment to new rules and terms of reference. The business uncertainties also include the fact that issues concerning nuclear technology may be subject to various expressions of opinion and debate. In such a context it cannot be ruled out that opinion may emerge on matters that directly or indirectly restrict Studsvik's scope of business action. Studsvik works consistently to maintain a high level of public confi dence. Its approach to the world around is characterized by dialogue and the principle of the greatest possible transparency.
Financial risks and uncertainties mainly include fl uctuations in exchange rates and interest rates, and counterparty risk, i.e. that the Group is exposed to losses due to a counterparty's insolvency.
The responsibility for assessing risk lies with the respective subsidiary, but is examined and followed up by the Parent Company. An overall analysis of the Group's risks and how they are dealt with is given in the 2006 Annual Report, which is also available on the company's website. Apart from these risks, no further signifi cant risks are estimated to have arisen.
Outlook for 2008
The overall assessment of the nuclear power market suggests that it is an expanding market. Modernization and upgrading/expansion programmes are underway in several countries. Within the framework of such projects, services of the type provided by Studsvik are in demand, including waste treatment, materials testing, and consulting services. Decommissioning activities are expected to continue growing in scope and size in the UK market and to increase slightly in Germany. It is estimated that the number of outage days in the German nuclear power industry will be fewer in 2008 than in 2007, which was characterized by unplanned and long outages in several plants. The fi erce competition on the American waste treatment market is expected to persist and leave its mark on some parts of the business. Market develop ments will create an environment favorable to healthy organic growth in most segments of the business in 2008.
Accounting policies
This interim report has been prepared in accordance with IAS 34, the Swedish Financial Accounting Standards Council's recommendations RR 31 and RR 32:06. The new recommendations that apply as of January 1, 2007 have not affected the Group's fi nancial performance.
Nyköping, February 14, 2008
On behalf of the Board of Directors
Magnus Groth President
Review Report
We have reviewed this report for the period of January 1, 2007 to December 31, 2007 for Studsvik AB (publ). 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.
We conducted our review in accordance with the Swedish Standard on Review Engagements SÖG 2410, Review of Interim Report Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for fi nancial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing in Sweden, RS, 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 signifi cant matters that might be identifi ed in an audit. Accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all mater ial respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the Parent Company.
Stockholm, February 14, 2008
PricewaterhouseCoopers AB
Magnus Brändström Göran Tidström Authorized Public Accountant Authorized Public Accountant Auditor in charge
Time Schedule for Financial Information
Interim Report January-March 2008 April 22, 2008 Interim Report January-June 2008 July 22, 2008 Interim Report January-September 2008 October 29, 2008
For Further Information Contact
Magnus Groth, President and Chief Executive Offi cer, +46 155 22 10 86 or +46 709 67 70 86 (cell phone), Jerry Ericsson, Chief Financial Offi cer, +46 155 22 10 32 or +46 709 67 70 32 (cell phone).
See also www.studsvik.se
Consolidated Income Statement
Amounts in SEK million
| October | October | |||
|---|---|---|---|---|
| December 2007 | December 2006 | Full Year 2007 | Full Year 2006 | |
| Net sales | 370.6 | 329.2 | 1,314.7 | 1,219.6 |
| Cost of services sold | –283.1 | –235.6 | –1,000.1 | –906.5 |
| Gross profi t | 87.5 | 93.6 | 314.6 | 313.1 |
| Other operating income | –6.8 | 15.5 | 25.1 | 14.3 |
| Selling and marketing expenses | –9.0 | –11.4 | –53.8 | –44.6 |
| Administrative expenses | –48.8 | –56.3 | –180.4 | –164.2 |
| Research and development costs | –13.3 | –10.5 | –41.8 | –39.8 |
| Other operating expenses | 5.7 | –9.7 | –1.6 | –7.5 |
| Operating profi t | 15.3 | 21.2 | 62.1 | 71.3 |
| Financial income | 1.2 | 5.9 | 8.7 | 23.1 |
| Financial expenses | –6.5 | –2.9 | –24.8 | –37.3 |
| Profi t after fi nancial items | 10.0 | 24.2 | 46.0 | 57.1 |
| Income tax1) | 3.0 | –10.9 | 1.2 | –22.3 |
| Profi t for the period | 13.0 | 13.3 | 47.2 | 34.8 |
| Attributable to | ||||
| – Parent company's shareholders | 12.4 | 13.3 | 46.5 | 34.8 |
| – Minority interest | 0.6 | - | 0.7 | - |
| Earnings per share, SEK | ||||
| – Before dilution | 1.58 | 1.62 | 5.65 | 4.24 |
| – After dilution | 1.58 | 1.62 | 5.65 | 4.24 |
1) The Group's deferred tax liabilities have been revalued in response to a reduction in corporation tax in Germany from 2008. The revaluation has been reported in the Group's tax expense. The low tax rate for the period January to December 2007 is explained by, over and above that, to the fact that the reported pre-tax earnings include non-taxable capital gains from the sale of Studsvik Stensand.
Condensed Consolidated Balance Sheet
| Amounts in SEK million | ||
|---|---|---|
| December 2007 | December 2006 | |
| Assets | ||
| Goodwill | 311.7 | 304.7 |
| Other intangible fi xed assets | 57.0 | 50.8 |
| Tangible fi xed assets | 406.6 | 400.7 |
| Financial fi xed assets | 67.3 | 72.1 |
| Total fi xed assets | 842.6 | 828.3 |
| Inventories | 22.5 | 6.9 |
| Receivables – trade | 206.0 | 189.2 |
| Other current receivables | 98.0 | 85.4 |
| Liquid assets | 176.9 | 247.6 |
| Total current assets | 503.4 | 529.1 |
| Total assets | 1,346.0 | 1,357.4 |
| Equity and liabilities | ||
| Equity attributable to parent company's shareholders | 568.4 | 558.7 |
| Minority interest | 3.4 | - |
| Borrowings | 196.4 | 307.4 |
| Provisions | 102.2 | 105.7 |
| Other non-current liabilities | 8.0 | 4.0 |
| Total non-current liabilities | 306.6 | 417.1 |
| Trade payables | 63.3 | 41.8 |
| Borrowings | 122.2 | 39.8 |
| Other current liabilities | 282.1 | 300.0 |
| Total current liabilities | 467.6 | 381.6 |
| Total equity and liabilities | 1,346.0 | 1,357.4 |
| Pledged assets Contingent liabilities |
181,5 93.3 |
151.9 35.3 |
Changes in Equity
Condensed Consolidated Cash Flow Statement
Amounts in SEK million
| Full Year 2007 | Full Year 2006 | |
|---|---|---|
| Operating activities | ||
| Operating profi t | 62.1 | 71.3 |
| Depreciations | 60.1 | 53.8 |
| Other non-cash items | –22.6 | –3.1 |
| 99.6 | 122.0 | |
| Financial items, net | –16.1 | –14.1 |
| Income tax paid | –6.8 | –2.4 |
| Cash fl ow from operating activities before | ||
| changes in working capital | 76.7 | 105.5 |
| Changes in working capital | –37.7 | –1.4 |
| Cash fl ow from operating activities | 39.0 | 104.1 |
| Investing activities | ||
| Investments | –122.4 | –344.7 |
| Other changes from investing activities | 47.0 | 19.6 |
| Cash fl ow from investing activities | –75.4 | –325.1 |
| Financing activities | ||
| Change, borrowings | –19.1 | 168.2 |
| Dividend to shareholders | –16.4 | –16.4 |
| Cash fl ow from fi nancing activities | –35.5 | 151.8 |
| Change in liquid assets | –71.9 | –69.2 |
| Liquid assets at the beginning of the year | 247.6 | 323.4 |
| Translation difference in liquid assets | 1.2 | –6.6 |
| Translation difference | - | - |
| Liquid assets at the end of the period | 176.9 | 247.6 |
Company Acquisitions
| Company Acquisitions in 2007 | Date |
|---|---|
| • Dr. Fary GmbH Delta Phi | 2007-04-01 |
| • Dr. Fary Ing Büro GmbH Co. KG | 2007-04-01 |
| • Alpha Engineering | 2007-08-01 |
The acquired operations contributed net sales of SEK 22.9 million and an operating profi t of SEK 2.4 million for the period of April 1 to December 31, 2007. If the acquisitions had been included from January 1, the Group's net sales would have been SEK 1,344.0 million and the operating profi t would have been SEK 66.3 million.
Acquired Net Assets and Goodwill
Amounts in SEK million
| • Cash payment • Direct costs in conection with acquisitions Total purchase price Fair value of net assets acquired Goodwill Intangible assets Deferred tax |
Purchase price | |
|---|---|---|
| 46.0 | ||
| 1.2 | ||
| 47.2 | ||
| 18.3 | ||
| 28.9 | ||
| 11.8 | ||
| –3.5 |
Goodwill is attributable to the market position of the acquired businesses and the synergies that are expected to arise from their subsequent integration with Studsvik's other companies after the acquisitions.
Financial Ratios for the Group
Amounts in SEK million
| Full Year 2007 | Full Year 2006 | |
|---|---|---|
| Operating profi t | ||
| Operating profi t before depreciation | 122.2 | 125.1 |
| Margins | ||
| Operating margin before depreciation, % | 9.3 | 10.3 |
| Operating margin, % | 4.7 | 5.8 |
| Profi t margin, % | 3.5 | 4.7 |
| Profi tability | ||
| Return on operating capital, % | 9.0 | 13.0 |
| Return on capital employed, % | 7.9 | 11.3 |
| Return on equity, % | 8.2 | 6.2 |
| Capital structure | ||
| Operating capital | 713.6 | 658.3 |
| Capital employed | 890.5 | 905.8 |
| Equity | 571.8 | 558.7 |
| Interest-bearing net debt | 141.8 | 99.6 |
| Net debt-equity ratio | 0.2 | 0.2 |
| Interest cover ratio | 2.9 | 2.5 |
| Equity-assets ratio, % | 42.5 | 41.2 |
| Cash fl ow | ||
| Self fi nancing ratio | 0.3 | 0.3 |
| Investments | 127.3 | 344.7 |
| Employees | ||
| Average number of employees | 1,141 | 1,279 |
| Net sales per employee | 1.2 | 1.0 |
| Data per Share | October | October | ||
|---|---|---|---|---|
| December 2007 | December 2006 | Full Year 2007 | Full Year 2006 | |
| Number of shares at the end of the period | 8,218,611 | 8,218,611 | 8,218,611 | 8,218,611 |
| Average number of shares | 8,218,611 | 8,218,611 | 8,218,611 | 8,218,611 |
| Earnings per share before dilution, SEK | 1.58 | 1.62 | 5.65 | 4.24 |
| Earnings per share after dilution, SEK | 1.58 | 1.62 | 5.65 | 4.24 |
| Equity per share, SEK | 69.58 | 69.00 | 69.58 | 67.97 |
Net Sales per Geographical Segment
Amounts in SEK million
| October | October | |||
|---|---|---|---|---|
| December 2007 | December 2006 | Full Year 2007 | Full Year 2006 | |
| Sweden | 132.6 | 91.8 | 258.7 | 336.5 |
| Europe, excluding Sweden | 138.4 | 107.7 | 564.3 | 424.4 |
| North America | 92.4 | 126.3 | 463.6 | 433.2 |
| Asia | 7.2 | 3.2 | 25.9 | 20.3 |
| Other markets | 0.0 | 0.2 | 2.2 | 5.2 |
| Total | 370.6 | 329.2 | 1,314.7 | 1,219.6 |
Financial Data per Segment (new structure)
| Amounts in SEK million | October– | October– | ||
|---|---|---|---|---|
| December 2007 | December 2006 | Full Year 2007 | Full Year 2006 | |
| Sweden | ||||
| Net sales | 43.6 | 36.0 | 135.4 | 126.2 |
| Operating profi t | 13.5 | 12.3 | 28.2 | 26.3 |
| Assets | 121.1 | 112.0 | 121.1 | 112.0 |
| Liabilities | 58.8 | 41.1 | 58.8 | 41.1 |
| Investments | 6.3 | 7.1 | 33.9 | 13.4 |
| Depreciation and amortization | 1.5 | 1.2 | 5.8 | 4.5 |
| Average number of employees | 80 | 73 | 78 | 75 |
| United Kingdom | ||||
| Net sales | 38.9 | 13.9 | 129.1 | 30.9 |
| Operating profi t | 0.9 | –2.5 | 3.0 | –11.3 |
| Assets | 89.9 | 41.1 | 89.9 | 41.1 |
| Liabilities | 47.8 | 28.7 | 47.8 | 28.7 |
| Investments | 2.9 | 1.7 | 42.4 | 19.3 |
| Depreciation and amortization | 1.5 | 0.2 | 2.4 | 0.5 |
| Average number of employees | 88 | 35 | 65 | 36 |
| Germany | ||||
| Net sales | 84.6 | 81.2 | 341.3 | 308.7 |
| Operating profi t | 4.1 | 4.4 | 25.3 | 25.8 |
| Assets | 244.4 | 206.3 | 244.4 | 206.3 |
| Liabilities | 179.1 | 165.7 | 179.1 | 165.7 |
| Investments | 2.9 | 0.0 | 17.6 | 5.9 |
| Depreciation and amortization | 1.0 | 0.8 | 5.2 | 4.1 |
| Average number of employees | 587 | 559 | 564 | 534 |
| USA | ||||
| Net sales | 94.3 | 106.6 | 427.7 | 364.3 |
| Operating profi t | –4.6 | –5.7 | 6.3 | 11.4 |
| Assets | 624.6 | 695.6 | 624.6 | 695.6 |
| Liabilities | 326.3 | 374.9 | 326.3 | 374.9 |
| Investments | 9.4 | 1.7 | 21.4 | 288.8 |
| Depreciation and amortization | 7.2 | 8.6 | 35.5 | 33.4 |
| Average number of employees | 218 | 204 | 234 | 199 |
| Global Services | ||||
| Net sales | 52.8 | 43.7 | 178.8 | 167.7 |
| Operating profi t | 8.8 | 17.7 | 14.4 | 36.4 |
| Assets | 183.3 | 215.5 | 183.3 | 215.5 |
| Liabilities | 158.7 | 196.1 | 158.7 | 196.1 |
| Investments | 1.0 | 4.4 | 5.3 | 10.3 |
| Depreciation and amortization | 2.0 | 1.5 | 8.1 | 7.4 |
| Average number of employees | 120 | 114 | 118 | 114 |
| Other1) | ||||
| Net sales | 72.5 | 62.0 | 159.1 | 279.7 |
| Operating profi t | –7.4 | –5.3 | –38.3 | –19.0 |
| Assets | 389.5 | 513.9 | 389.5 | 513.9 |
| Liabilities | 285.0 | 397.6 | 285.0 | 397.6 |
| Investments | 2.9 | 3.2 | 6.7 | 7.0 |
| Depreciation and amortization | 0.8 | 1.4 | 3.1 | 3.9 |
| Average number of employees | 83 | 336 | 82 | 321 |
| Group eliminations | ||||
| Net sales | –16.1 | –14.2 | –56.7 | –57.9 |
| Operating profi t | - | 0.3 | 23.22) | 1.7 |
| Assets | –306.8 | –427.0 | –306.8 | –427.0 |
| Liabilities | –281.6 | –405.4 | –281.6 | –405.4 |
| Investments | - | - | - | - |
| Depreciation and amortization | - | - | - | - |
1) Other operations mainly refer to the Parent Company, AB SVAFO and for 2006 Studsvik Stensand AB. AB SVAFO is responsible for management of older state-owned research waste and decommissioining of facilities related to previous state-owned research operations. The costs of the operations are covered by the Nuclear Waste Fund.
2) Operating profi t includes the capital gain on the sale of the shares in Studsvik Stensand AB, SEK 23.3 million.
Financial Data per SBA (previously applied structure)
| Amounts in SEK million | October– | October– | ||
|---|---|---|---|---|
| December 2007 | December 2006 | Full Year 2007 | Full Year 2006 | |
| Waste Treatment | ||||
| Net sales | 148.6 | 149.0 | 599.8 | 508.7 |
| Operating profi t | 8.5 | 5.7 | 35.6 | 33.6 |
| Assets | 799.9 | 830.2 | 799.9 | 830.2 |
| Liabilities | 425.1 | 439.9 | 425.1 | 439.9 |
| Investments | 15.8 | 9.3 | 63.3 | 321.2 |
| Depreciation and amortization | 9.2 | 7.8 | 42.3 | 38.3 |
| Average number of employees | 324 | 310 | 335 | 294 |
| Decommissioning | ||||
| Net sales | 78.1 | 48.8 | 270.1 | 189.0 |
| Operating profi t | 1.5 | 0.3 | 13.5 | 11.9 |
| Assets | 153.4 | 114.7 | 153.4 | 114.7 |
| Liabilities | 72.2 | 63.3 | 72.2 | 63.3 |
| Investments | 1.9 | 0.0 | 37.3 | 4.0 |
| Depreciation and amortization | 1.3 | 0.4 | 3.4 | 3.2 |
| Average number of employees | 362 | 329 | 332 | 321 |
| Operating Effi ciency | ||||
| Net sales | 52.8 | 43.7 | 178.8 | 167.7 |
| Operating profi t | 8.8 | 17.7 | 14.4 | 36.4 |
| Assets | 183.3 | 215.5 | 183.3 | 215.5 |
| Liabilities | 158.7 | 196.1 | 158.7 | 196.1 |
| Investments | 1.0 | 4.4 | 5.3 | 10.3 |
| Depreciation and amortization | 2.0 | 1.5 | 8.1 | 7.4 |
| Average number of employees | 120 | 114 | 118 | 114 |
| Service and Maintenance | ||||
| Net sales | 34.7 | 67.3 | 163.5 | 268.8 |
| Operating profi t | 3.9 | 5.0 | 13.7 | 17.3 |
| Assets | 159.2 | 179.8 | 159.2 | 179.8 |
| Liabilities | 148.2 | 165.6 | 148.2 | 165.6 |
| Investments | 3.7 | 0.6 | 14.8 | 2.6 |
| Depreciation and amortization | 0.7 | 0.6 | 3.2 | 2.2 |
| Average number of employees | 287 | 490 | 274 | 473 |
| Other1) | ||||
| Net sales | 72.5 | 31.5 | 159.1 | 143.9 |
| Operating profi t | –7.4 | –7.5 | –38.3 | –27.9 |
| Assets | 389.5 | 487.0 | 389.5 | 487.0 |
| Liabilities | 285.0 | 388.4 | 285.0 | 388.4 |
| Investments | 2.9 | 3.8 | 6.7 | 6.6 |
| Depreciation and amortization | 0.8 | 1.1 | 3.1 | 2.7 |
| Average number of employees | 83 | 78 | 82 | 77 |
| Group eliminations | ||||
| Net sales | –16.1 | –11.1 | –56.6 | –58.5 |
| Operating profi t | - | - | 23.22) | - |
| Assets | –339.4 | –469.8 | –339.4 | –469.8 |
| Liabilities | –315.1 | –454.6 | –315.1 | –454.6 |
| Investments | - | - | - | - |
| Depreciation and amortization | - | - | - | - |
1) Other operations mainly refer to the Parent Company and AB SVAFO. AB SVAFO is responsible for management of older state-owned research waste and decommissioining of facilities related to previous state-owned research operations. The costs of the operations are covered by the Nuclear Waste Fund.
2) Operating profi t includes the capital gain on the sale of the shares in Studsvik Stensand AB, SEK 23.3 million.
Five-year Review1)
Amounts in SEK million
The fi nancial information in this section is based on Studsvik's consolidated accounts for the fi nancial years of 2003 to 2007. Results for companies and activities that have been disposed of are included up to the date of the disposal, while the results of acquired companies have been included from the date of acquisition. In 2005, two SBAs were discontinued. The income statements for 2005 and 2004 have been adjusted for this reason. These activities are reported in the income statements as "Profi t from discontinued operations". Balance sheets and cash fl ow statements have not been adjusted. The fi nancial fi gures and ratios which have been completely or partially derived from the income statements have been adjusted.
| Condensed Income Statements | 2007 | 2006 | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|
| Net sales | 1,314.7 | 1,219.6 | 1,088.3 | 1,025.4 | 1,113.8 |
| Cost of services sold | –1,000.1 | –906.5 | –802.9 | –839.3 | –842.5 |
| Gross profi t | 314.6 | 313.1 | 285.4 | 186.1 | 271.3 |
| Other operating income | 25.1 | 14.3 | 19.8 | 1.7 | 1.5 |
| Selling expenses | –53.8 | –44.6 | –41.9 | –36.6 | –34.8 |
| Administrative expenses | –180.4 | –164.2 | –146.4 | –143.4 | –141.2 |
| Research and development costs | –41.8 | –39.8 | –35.5 | –34.6 | –42.1 |
| Other operating expenses | –1.6 | –7.5 | –2.6 | –0.1 | –0.6 |
| Result from participations in associated companies | - | - | - | 2.6 | 7.3 |
| Operating profi t | 62.1 | 71.3 | 78.8 | –24.3 | 61.4 |
| Financial income | 8.7 | 23.1 | 8.5 | 7.6 | 6.8 |
| Financial expense | –24.8 | –37.3 | –11.1 | –15.1 | –15.9 |
| Profi t after fi nancial items | 46.0 | 57.1 | 76.2 | –31.8 | 52.3 |
| Income tax | 1.2 | –22.3 | –28.7 | 56.1 | –20.4 |
| Profi t from discontinued operations | - | - | 13.6 | –90.8 | - |
| Profi t for the period | 47.2 | 34.8 | 61.1 | –66.5 | 31.9 |
| Attributable to | |||||
| – Parent company's shareholders | 46.5 | 34.8 | 61.1 | –66.5 | 31.9 |
| – Minority interest | 0.7 | - | - | - | - |
| Condensed Balance Sheets | 2007 | 2006 | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|
| Assets | |||||
| Goodwill | 311.7 | 304.7 | 127.4 | 120.7 | 123.4 |
| Other intangible non-current assets | 57.0 | 50.8 | 5.0 | 7.4 | 9.8 |
| Property, plant and equipment | 406.6 | 400.7 | 372.0 | 331.8 | 475.5 |
| Financial non-current assets | 67.3 | 72.1 | 99.0 | 81.5 | 31.3 |
| Total non-current assets | 842.6 | 828.3 | 603.4 | 541.4 | 640.0 |
| Inventories | 22.5 | 6.9 | 10.4 | 10.4 | 16.8 |
| Receivables – trade | 206.0 | 189.2 | 167.3 | 139.9 | 163.6 |
| Other current recievables | 98.0 | 85.4 | 78.8 | 141.2 | 62.1 |
| Liquid assets | 176.9 | 247.6 | 323.4 | 319.2 | 299.9 |
| Total current assets | 503.4 | 529.1 | 579.9 | 610.7 | 542.4 |
| Total assets | 1,346.0 | 1,357.4 | 1,183.3 | 1,152.1 | 1,182.4 |
| Equity and liabilities | |||||
| Equity attributable to parent company's shareholders | 568.4 | 558.7 | 566.6 | 443.2 | 531.6 |
| Minority interest | 3.4 | - | - | - | - |
| Borrowings | 196.4 | 307.4 | 192.8 | 186.2 | 213.9 |
| Provisions | 102.2 | 105.7 | 165.8 | 251.9 | 162.7 |
| Other non-current liablities | 8.0 | 4.0 | 6.4 | 0.1 | 9.2 |
| Total non-current liabilities | 306.6 | 417.1 | 365.0 | 438.2 | 385.8 |
| Trade payables | 63.3 | 41.8 | 54.0 | 44.4 | 40.7 |
| Borrowings | 122.2 | 39.8 | 0.1 | 7.8 | 4.9 |
| Other current liabilities | 282.1 | 300.0 | 197.6 | 218.5 | 219.4 |
| Total current liabilities | 467.6 | 381.6 | 251.7 | 270.7 | 265.0 |
| Total equity and liabilities | 1,346.0 | 1,357.4 | 1,183.3 | 1,152.1 | 1,182.4 |
1) 2004-2007 are reported in accordance with IFRS.
| Condensed Cash Flow Statements | 2007 | 2006 | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|
| Operating profi t | 62.1 | 71.3 | 92.4 | –119.7 | 61.4 |
| Write-downs added back | 60.1 | 53.8 | 47.1 | 78.3 | 95.3 |
| Other items not affecting liquidity | –22.6 | –3.1 | –6.5 | 146.4 | –0.2 |
| 99.6 | 122.0 | 133.0 | 105.0 | 156.5 | |
| Financial items, net | –16.1 | –14.1 | –4.8 | –8.0 | –9.6 |
| Income tax | –6.8 | –2.4 | –28.2 | –12.5 | –17.3 |
| Cash fl ow before changes in working capital | 76.7 | 105.5 | 100.0 | 84.5 | 129.6 |
| Changes in working capital | –37.7 | –1.4 | –82.0 | 19.9 | 28.5 |
| Cash fl ow before investments | 39.0 | 104.1 | 18.0 | 104.4 | 158.1 |
| Investments | –122.4 | –344.7 | –45.0 | –52.4 | –119.6 |
| Cash fl ow after investments | –83.4 | –240.6 | –27.0 | 52.0 | 38.5 |
| Financial Figures and Ratios | 2007 | 2006 | 2005 | 2004 | 2003 |
| Margins | |||||
| Operating margin before depreciation, % | 9.3 | 10.3 | 11.6 | 4.7 | 14.1 |
| Operating margin, % | 4.7 | 5.8 | 7.2 | neg | 5.5 |
| Profi t margin, % | 3.5 | 4.7 | 7.0 | neg | 4.7 |
| Profi tability | |||||
| Return on operating capital, % | 9.0 | 13.0 | 20.9 | neg | 12.3 |
| Return on capital employed, % | 7.9 | 11.3 | 12.5 | neg | 9.6 |
| Return on equity, % | 8.2 | 6.2 | 12.1 | neg | 6.4 |
| Capital structure | |||||
| Operating capital | 713.6 | 658.3 | 436.2 | 318.0 | 450.4 |
| Capital employed | 890.5 | 905.8 | 759.5 | 637.2 | 750.4 |
| Equity, SEK million | 571.8 | 558.7 | 566.6 | 443.4 | 531.3 |
| Interest-bearing net debt | 141.8 | 99.6 | –130.4 | –125.2 | –81.1 |
| Net debt-equity ratio | 0.2 | 0.2 | –0.2 | –0.3 | –0.2 |
| Interest cover ratio | 2.9 | 2.5 | 7.9 | neg | 4.3 |
| Equity-assets ratio, % | 42.5 | 41.2 | 47.9 | 38.5 | 44.9 |
| Cash fl ow | |||||
| Self fi nancing ratio | 0.3 | 0.3 | 0.4 | 2.1 | 1.3 |
| Investments | 127.3 | 344.7 | 45.0 | 52.4 | 119.6 |
| Employees | |||||
| Average number of employees | 1,141 | 1,279 | 1,278 | 1,353 | 1,313 |
| Net sales per employee | 1.2 | 1.0 | 0.9 | 0.8 | 0.8 |
Quarterly Review
| Amounts in SEK million | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 | 2006 | 20051) | ||||||||||
| Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |
| Net sales | 370.6 | 325.1 | 345.8 | 273.2 | 329.2 | 321.3 | 317.5 | 251.6 | 298.1 | 265.8 | 286.6 | 235.7 |
| Operating expenses | –355.3 | –316.3 | –330.0 | –251.0 | –308.0 | –298.3 | –290.8 | –251.2 | –282.6 | –249.1 | –261.8 | –215.8 |
| Operating profi t | 15.3 | 8.8 | 15.8 | 22.2 | 21.2 | 23.0 | 26.7 | 0.4 | 15.5 | 16.7 | 24.8 | 19.9 |
| Financial items, net | –5.3 | –4.1 | –3.0 | –3.7 | 3.0 | –5.7 | –6.4 | –5.2 | –3.0 | 1.7 | 0.1 | –1.2 |
| Profi t after fi nancial items | 10.0 | 4.7 | 12.8 | 18.5 | 24.2 | 17.3 | 20.3 | –4.8 | 12.5 | 18.4 | 24.9 | 18.7 |
1) Refers to profi t from continuing operations.
Parent Company Income Statement Amounts in SEK million
| October– | October– | |||
|---|---|---|---|---|
| December 2007 | December 2006 | Full Year 2007 | Full Year 2006 | |
| Net sales | 1.5 | 2.0 | 5.6 | 8.0 |
| Cost of services sold | –1.7 | –1.2 | –5.4 | –6.2 |
| Gross profi t | –0.2 | 0.8 | 0.2 | 1.8 |
| Other operating costs | –7.9 | –8.2 | –38.5 | –29.1 |
| Operating profi t | –8.1 | –7.4 | –38.3 | –27.3 |
| Financial net | –0.2 | 7.7 | 35.7 | 26.0 |
| Profi t before tax | –8.3 | 0.3 | –2.6 | –1.3 |
| Appropriations | 0.3 | 28.5 | 0.3 | 28.5 |
| Income tax | 1.1 | –2.9 | 10.5 | –0.9 |
| Profi t for the period | –6.9 | 25.9 | 8.2 | 26.3 |
Parent Company Balance Sheet
Amounts i SEK million
| December 2007 | December 2006 | |
|---|---|---|
| Assets | ||
| Tangible fi xed assets | 1.7 | 2.1 |
| Financial fi xed assets | 947.1 | 977.8 |
| Total fi xed assets | 948.8 | 979.9 |
| Current assets | 56.1 | 56.3 |
| Liquid assets | 91.2 | 149.7 |
| Total current assets | 147.3 | 206.0 |
| Total assets | 1,096.1 | 1,185.9 |
| Equity and liabilities | ||
| Equity | 833.1 | 814.5 |
| Untaxed reserves | 6.9 | 7.2 |
| Non-current liabilities | 193.2 | 237.2 |
| Current liabilities | 62.9 | 127.0 |
| Total liabilities | 256.1 | 364.2 |
| Total equity and liabilities | 1,096.1 | 1,185.9 |
| Major Shareholders, December 31, 2007 | Number | |
|---|---|---|
| of shares | Share, % | |
| Karinen Family | 1,589,012 | 19.3 |
| Briban Invest AB | 1,283,492 | 15.6 |
| Allianz Global Inv | 714,561 | 8.7 |
| Goldman Sachs International Ltd | 472,750 | 5.8 |
| Invus Investment AB | 184,800 | 2.2 |
| SEB Sverigefond Småbolag | 157,200 | 1.9 |
| Citibank NA London | 154,268 | 1.9 |
| Morgan Stanly & Co Inc | 149,750 | 1.8 |
| SEB Sverige Småbolag Chans/Risk | 145,500 | 1.8 |
| The Northern Trust Co | 133,550 | 1.6 |
| Total ten largest shareholders – holdings | 4,984,883 | 60.6 |
| Other shareholders | 3,233,728 | 39.4 |
| Total | 8,218,611 | 100.0 |
The Studsvik Share
During the year, the share price varied between a high of SEK 290 on January 15 and a low of SEK 150 on December 21. The opening price was SEK 253 at the beginning of the year and the closing price on December 31 was SEK 155. During 2007, 2 million shares were traded
Facts about Studsvik
Studsvik offers a range of advanced technical services to the international nuclear power industry in such areas as waste treatment, decommissioning, engineering & services, and operating effi ciency. The company has 60 years experience of nuclear technology and radiological services. Studsvik is a leading supplier on a rapidly expanding market. The business is conducted through fi ve segments: Sweden, United Kingdom, Germany, USA och Global Services. Studsvik has 1,200 employees. The company's shares are listed on the OMX Nordic Exchange Stockholm, MidCap.
Studsvik AB
P.O. Box 556, SE-611 10 Nyköping, Sweden Phone +46 155 22 10 00 Telefax +46 155 26 30 00 E-mail [email protected] www.studsvik.com