Quarterly Report • Oct 27, 2010
Quarterly Report
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January 1– September 30, 2010 Interim Report Q3
Due to increased net sales and adaptation of costs we estimate the operating profit for 2010 to improve clearly over 2009.
Market for our Video and Broadband Solutions remained at the early year's level. The EUR 16 million frame agreement on upgrading of cable networks over the next four years signed in July with the Israeli HOT Telecom provides a tangible positive sign of the gradual recovery in the market. Deliveries under this frame agreement will start in the last quarter of the current year. The acquisition of Satlan in August strengthened the market position of Video and Broadband Solutions in Poland. Satlan supplies IP video and broadband solutions to Polish cable operators and media service providers.
In Q3, in Germany - Network Services' main market area - the customer demand still involved low-price deliveries. Unit prices clearly below those of the comparative year weakened the net sales and thereby the year-on-year profitability. In our main market, we have started activities designed to widen our clientele and to increase flexibility in our capacity utilisation. Streamlining of operations will also be continued. Towards the end of this review period, the German demand for services was on the increase.
We have maintained our strong market position in Europe and our competitiveness remains good.
Teleste will press on determinedly with the implementation of our growth strategy, which consists of R&D solutions ensuring profitable growth, strengthening of our distribution channels and expansion of our services offering. In the current market situation, our careful cost management and adaptation measures will also be continued. In Q3, reorganisation of the German services business was delayed since more resources than estimated were required for the technical clarification items related to the delivery of services. In Q4, we estimate the demand for services in Germany to pick up due to the extra marketing efforts carried out by the main client to promote television and broadband services. Furthermore, handover of a few sizeable deliveries will have a positive impact on net sales and profitability. As for Network Services, we estimate the profitability of Q4 to improve over Q3 but fall below that of the comparative year, which is caused by the fact that a larger number of delivered services involved simpler services in the lower price bracket. The three-year services contract signed with Kabel Deutschland after the period under review ensures our leading position in the German services market enabling a long-term development of business. We will provide the necessary requirements for profitable growth in the German services market by developing our services processes, quality and ERP systems. As for Video and Broadband Solutions, we particularly expect the growth in deliveries of optical network solutions and the Luminato headend to continue.
We confirm our estimation of profitable growth for 2010.
The generally difficult financial situation in Europe and the ownership arrangements among the cable operators are likely to continue and these may have an effect on the timing of investments. The prolonged delivery times for some materials may erode our ability to deliver in the latter part of the year.
Year-on-year orders received in Q3 declined by 18.0 % standing at EUR 39.9 (48.6) million. For Network Services the year of comparison included project orders of approximately EUR 5 million. The Group's order backlog totalled EUR 13.3 (30.3) million. The order backlog for the period of comparison included a headend order of EUR 12 million, which was written off from the backlog in Q2 of 2010, and one-off orders of EUR 8.0 million delivered in the current year. The EUR 16 million frame agreement signed with the Israeli HOT Telecom in July is not included in the order backlog.
The Q3 2010 net sales for the business equalled EUR 38.6 (41.7) million, which is 7.4 % below the figure for the period of comparison. The drop in net sales was caused by increased number of lower price range deliveries in the German services of Network Services and the growth in incomplete deliveries.
Operating profit stood at EUR 2.0 (1.6) million making 5.1 % (3.9 %) of the net sales. Undiluted result per share for Q3 was EUR 0.07 (0.03).
Year-on-year orders received improved by 11.7 % standing at EUR 116.4 (104.2) million. Orders increased over the previous year since part of the German acquisitions were carried out in H2 of 2009. Order backlog totalled EUR 13.3 (30.3) million. The order backlog for the period of comparison included a headend order of EUR 12 million, which was written off from the backlog in Q2 of 2010, and one-off orders of EUR 8.0 million delivered in the current year.
Net sales grew by 23.8 % over the year of comparison amounting to EUR 121.2 (97.9) million. The increase in net sales was mainly due to acquisitions carried out in the second half of 2009.
Operating profit stood at EUR 4.5 (0.8) million making 3.7 % (0.8 %) of the net sales. Year-on-year growth in the operating profit was due to an increase of 7 % in Video and Broadband Solutions' net sales, reduced material costs and cost adaptation. Operating profit for the period of comparison included EUR 2.6 million of other operating income, whereas in the period under review these amounted to EUR 1.0 million. Undiluted result per share was EUR 0.15 (-0.03).
This business area focuses on broadband subscriber networks, video services platforms and CCTV applications. Major clientele of the business area consists of cable operators but includes also resellers and public sector organizations. The main market of the business area is Europe.
Video and Broadband Solutions in Q3
In the period under review we strengthened our presence in the Polish market by acquiring Satlan S.P. z.o.o. This acquisition has no significant impact on net sales nor profitability in Q3.
Orders received totalled EUR 21.2 (22.5) million. A frame agreement on upgrading of cable networks was signed with the Israeli HOT Telecom. In our estimation the scope of deliveries will amount to approximately EUR 16 million over the next four years. Orders received for the review period include an order placed by HOT Telecom of approximately EUR one million. Order backlog totalled EUR 13.3 (25.3) million.
Net sales in Q3 amounted to EUR 19.9 (18.3) million. Operating profit stood at EUR 2.0 (1.5) million making 9.8 % (8.5 %) of the net sales. Margin on materials remained on a good level also in Q3.
Product development expenses in Q3 equalled EUR 2.2 (2.4), in other words 11.2 % (13.2 %) of the net sales. Some 60 % (70 %) of product development expenses involved further development of product platforms currently in production, maintenance, and customer-specific product applications. Activated product development expenses stood at EUR 0.4 (0.4) million involving the Luminato headend and the processing system for the Advanced Video Coding protocol (H.264). Our R&D efforts continued regarding the new generation amplifier technology (the Access product range), the optical transfer and reception system for HFC networks (the HDO product range) and the video surveillance management system (VMX).
Video and Broadband Solutions January to September
Orders received stood at EUR 59.5 (58.9) million, i.e. 0.9 % above the period of comparison.
Net sales grew by 7.0 % amounting to EUR 59.2 (55.3) million. The growth in net sales was mainly due to deliveries of the Access network to the Nordic countries and video surveillance deliveries to the USA. Deliveries related to the Luminato headend system were above the comparative period. Operating profit stood at EUR 4.0 (-0.2) million making 6.7 % (-0.4 %) of the net sales. This improvement in operating profit was due to increased net sales, good margin on materials and cost adaptation.
R&D expenses of Video and Broadband Solutions amounted to EUR 7.7 (8.3) million. Activated R&D expenses stood at EUR 1.2 (1.2) million and depreciation on previous activation items equalled EUR 1.9 (1.7) million.
Clientele of Teleste's Network Services business consists mainly of large European cable operators. The services provided by this business area include planning, new construction, upgrading and maintenance of cable networks. Implementation and scope of the relevant services vary by client ranging from standalone applications to integrated turnkey deliveries. Most deliveries are based on frame agreements. Some of our projects also include Teleste's own product solutions. Our know-how in services covers all the sectors related to the cable network technology from installation and maintenance of headends to upgrading of house networks. Parts of the projects are carried out by our subcontractor network.
Orders received totalled EUR 18.7 (26.1) million. Orders received for the comparative period included oneoff deliveries of EUR 6 million. In Q3, orders on internet connection related services placed by our main customer in Germany continued to involve supplementary items in the lower revenue bracket exclusive of any more demanding upgrades of house networks.
Net sales of the business area amounted to EUR 18.7 (23.4) million, i.e. 20.2 % below the comparative period. The year-on-year decrease in net sales was caused by the fact that the German deliveries involved internet connections in the lower revenue bracket and because, in summer season, demand for services is typically weaker.
Operating profit stood at EUR 0.03 (0.1) million making 0.2 % (0.4 %) of the net sales. Year-on-year profitability fell due to decreased net sales and increased investments in technical clarification items related to deliveries of services.
Network Services January to September
Orders received totalled EUR 56.9 (45.3) million. The growth in orders received by 25.7 % over the comparative period was due to restructuring carried out in H2 2009 (the German acquisitions). In H1 of 2010, two new frame agreements were signed in Germany, involving contract extensions from current clients (NetCologne, delivery span 12 months and TeleColumbus, delivery span 6 years). The value of these contracts equals approximately EUR 8 million.
Net sales amounted to EUR 62.0 (42.6) million. The increased net sales by 45.6 % over the comparative period was due to German group restructuring carried out in H2 of 2009.
Operating profit decreased over the previous year amounting to EUR 0.5 (1.0) million. Decreased profitability in Germany was caused by increased deliveries in the lower price bracket and greater personnel expenses in Q3 related to technical clarification items involving deliveries of services. Also the cold winter in the beginning of the year hampered our delivery of services. Our German operations are being reorganized, which has caused expenses in the period under review.
Operating cash flow stood at EUR 4.5 (2.6) million. At the end of the period under review, the amount of unused binding stand-by credits amounted to EUR 19.5 (14.5) million. The current binding stand-by credits of EUR 40.0 million run till November 2013. The Group's equity ratio equalled 41.5 % (43.4 %)
and net gearing 26.7 % (32.6 %). Interest bearing debt on 30 September 2010 was EUR 22.9 (27.7) million.
Investments by the Group for the period under review totalled EUR 9.2 (17.5) million accounting for 7.6 % (17.9 %) of net sales. Investments: EUR 0.6 million (including the estimated additional contract price) involved the Swiss acquisition (Freycom) by Network Services, EUR 0.4 million involved redemption of minority shareholders out of Cableway AG, EUR 6.3 million (including the estimated additional contract price) involved acquisition of the Polish Satlan by Video and Broadband Solutions, EUR 0.4 (1.7) million involved expansion on the premises in Finland and EUR 1.2 (1.2) million in R&D. As to investments for the period, EUR 0.1 (0.1) million was carried out by means of financial leasing.
At the end of the reporting period, the number of full-time personnel employed by the Group equalled 1231 (1230/2009, 694/2008), of which Video and Broadband Solutions accounted for 567 (568) and Network Services 664 (662), respectively. Expenditure on employee benefits amounted to EUR 36.7 (31.2/January to September/2009, 24.5/January to September/2008) million.
As part of the cost-structure adaptation measures required by the general market situation, the Finnish personnel have continued on a rotating layoff. Measures agreed on in the co-determination procedures will be sustained until the end of 2010 as required by the market situation. The co-determination procedure was concluded on 22 January 2010. Streamlining of German operations of Network Services is in progress.
Founded in 1954, Teleste is a technology and service provider consisting of two business areas: Video and Broadband Solutions and Network Services. With Europe as the main market area, our most significant clients include European cable operators.
Concerning Video and Broadband Solutions, integrated deliveries of solutions create favourable conditions for growth, even if the involved resource allocation and technical implementation pose a challenge involving, therefore, also reasonable risks. The present difficult market situation may delay the implementation of investment plans among our clientele. Network investments carried out by the clients vary based on their need for upgrading and their capital structure. Much of Teleste's competition comes from the USA so the exchange rate of euro up against the US dollar affects our competitiveness. Teleste hedges against short-term currency exposure by means of forward contracts. Correct technological choices and their timing are vital for our success.
Net sales for Network Services comes, for the most part, from a small number of large European customers, so a significant change in the demand for services by any one of them is reflected in the actual deliveries. To ensure quality of services and cost-efficiency, along with an efficient service process management, customer satisfaction requires innovative solutions in terms of processes, products and logistics. Being committed to the technical management of the cable operators' networks and the development of well-designed product solutions, Teleste ensures efficient operation of the networks by providing its own and suppliers' personnel with continuous further training.
It is equally important for our business areas to take into account any market developments such as consolidations taking place among the clientele and competition.
The Board of Directors annually reviews any essential risks related to the company operation and the management thereof. Risk management constitutes an integral part of the strategic and operative practices of our business areas. Risks and their probability are reported to the Board by regular monthly reports.
The company has covered major risks of damage through insurance policies. These insurances do not include credit loss risks. In the period under review, no such risks materialized, and no legal proceedings or judicial procedures were pending that would have had any essential significance for the Group operation.
Parent company Teleste has branch offices in Australia, Spain, the Netherlands, China and Denmark with subsidiaries in 13 countries outside Finland. Teleste Management Oy, which was founded in March 2010, is included in the Teleste Group figures because, owing to financial arrangements, Teleste Corporation has control over the company.
The Annual General Meeting of Teleste Corporation on 9 April 2010 confirmed the financial statements for 2009 and discharged the Board of Directors and the CEO from liability for the financial period. The AGM confirmed the Board's proposed dividend of EUR 0.08 per share. The dividend was paid out on 21 April 2010.
The AGM decided that the Board of Directors shall consist of six members. Marjo Miettinen was reappointed Chairman of the Board of Directors while the reappointed Board Members include Pertti Ervi, Tero Laaksonen, Pertti Raatikainen, Kai Telanne and Petteri Walldén.
Authorised Public Accountants KPMG Oy Ab continue as the auditor until the next AGM. Accountant authorised by the Central Chamber of Commerce of Finland Esa Kailiala was chosen auditor-in-charge.
The AGM authorised the Board to acquire the maximum of 1,400,000 of the company's own shares and to convey the maximum of 1,779,985 company's own shares. The AGM also authorised the company Board to issue 10,000,000 new shares. Pursuant to the special rights provided by the company, the maximum number of significant shares is 5,000,000; these special rights are included in the authorisation to issue 10,000,000 new shares.
The authorizations are valid until the Annual General Meeting of Shareholders for year 2011. The Board has not exercised these rights.
On 30 September 2010, EM Group Oy was the largest single shareholder with a holding of 21.02 %.
In the period under review, the lowest company share price was EUR 3.63 (2.25) and the highest was EUR 5.33 (4.30). Closing price on 30 September 2010 stood at EUR 4.91 (4.10). According to Euroclear Finland Ltd, the number of shareholders at the end of the period under review was 5,306 (5,470). Foreign ownership accounted for 8.5 % (10.3 %). From 1 January to 30 September 2010, trading with Teleste share at NASDAQ OMX Helsinki amounted to EUR 11.6 (25.8) million. In the period under review, 2.6 (7.1) million Teleste shares were traded on the stock exchange.
In March 2010, Teleste Board of Directors decided on a directed share issue of 381,000 shares to Teleste Management Oy established by the management of Teleste Corporation. This directed share issue was authorized by the AGM on 7 April 2009.
At the end of September 2010, the number of own shares in the Group possession stood at 760,985 (379,985) out of which parent company Teleste Corporation had none (0) while other Group or controlled companies had 760,985 shares, respectively. At the end of the period, the Group's holding of the total amount of shares amounted to 4.18 % (2.13 %).
On 30 September 2010, the registered share capital of Teleste stood at EUR 6,966,932.80 divided in 18,186,590 shares.
Cautious approach to network investments is likely to continue among the operator clientele of Video and Broadband Solutions even for the rest of the year. Nevertheless, we believe the deliveries will continue at least on the level of 2009.
We estimate the demand by the current clientele of Network Services to remain stable on an annual level but with some fluctuation between the quarters. The strategic investments already carried out ensure that our net sales will improve over last year.
Due to increased net sales and adaptation of costs we estimate the operating profit for 2010 to improve clearly over 2009.
Teleste's final accounts for the financial year 2010 will be released on 2 February 2011.
26 October 2010
TELESTE CORPORATION Jukka Rinnevaara Board of Directors President and CEO
This interim report has been compiled in compliance with IAS 34, as it is accepted within EU, using the recognition and valuation principles with those used in the Annual Report. The data stated in this report is unaudited.
| STATEMENT OF COMPREHENSIVE INCOME (tEUR) |
7-9/2010 | 7-9/2009 | Change % | |
|---|---|---|---|---|
| Net Sales | 38,625 | 41,711 | -7.4 % | |
| Other operating income | 363 | 478 | -24.2 % | |
| Materials and services | -18,650 | -23,416 | -20.4 % | |
| Personnel expenses | -11,624 | -10,912 | 6.5 % | |
| Other operating expenses | -5,080 | -4,841 | 4.9 % | |
| Depreciation | -1,650 | -1,412 | 16.9 % | |
| Operating profit | 1,984 | 1,608 | 23.4 % | |
| Financial income and expenses | -111 | -154 | -27.9 % | |
| Share of profit of associates | 0 | -354 | n/a | |
| Profit after financial items | 1,873 | 1,100 | 70.2 % | |
| Profit before taxes | 1,873 | 1,100 | 70.2 % | |
| Taxes | -635 | -560 | 13.4 % | |
| Net profit | 1,238 | 540 | 129.1 % | |
| Attributable to: | ||||
| Equity holders of the parent | 1,238 | 540 | 129.1 % | |
| Earnings per share for result of the year attributable to the equity holders of the parent (expressed in EUR per share) |
||||
| Basic | 0.07 | 0.03 | 136.8 % | |
| Diluted | 0.07 | 0.03 | 133.2 % | |
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD (tEUR) | ||||
| Net profit | 1,238 | 540 | 129.1 % | |
| Translation differences | -67 | -73 | -8.2 % | |
| Fair value reserve | 7 | 0 | n/a | |
| Total comprehensive income for | ||||
| the period | 1,178 | 467 | 152.0 % | |
| Attributable to: | ||||
| Equity holders of the parent | 1,178 | 467 | 152.0 % | |
| STATEMENT OF | ||||
| COMPREHENSIVE INCOME (tEUR) | 1-9/2010 | 1-9/2009 | Change % | 1-12/2009 |
| Net Sales | 121,193 | 97,867 | 23.8 % | 141,651 |
| Other operating income | 971 | 2,591 | -62.5 % | 3,124 |
| Materials and services | -59,980 | -48,924 | 22.6 % | -69,962 |
| Personnel expenses | -36,684 | -31,177 | 17.7 % | -44,584 |
| Other operating expenses | -16,492 | -15,461 | 6.7 % | -21,323 |
| Depreciation | -4,543 | -4,090 | 11.1 % | -5,582 |
| Impairment loss | 0 | 0 | n/a | -800 |
| Operating profit | 4,465 | 806 | 454.1 % | 2,524 |
| Financial income and expenses Share of profit of associates |
-497 0 |
-539 -544 |
-7.8 % n/a |
-605 -544 |
|---|---|---|---|---|
| Profit after financial items | 3,968 | -277 | n/a | 1,375 |
| Profit before taxes | 3,968 | -277 | n/a | 1,375 |
| Taxes | -1,288 | -302 | 326.5 % | -959 |
| Net profit | 2,680 | -579 | n/a | 416 |
| Attributable to: Equity holders of the parent |
2,680 | -579 | n/a | 416 |
| Earnings per share for result of the year attributable to the equity holders of the | ||||
| parent (expressed in EUR per share) |
||||
| Basic Diluted |
0.15 0.15 |
-0.03 -0.03 |
n/a n/a |
0.02 0.02 |
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD (tEUR) | ||||
| Net profit | 2,680 | -579 | n/a | 416 |
| Translation differences | -125 | 19 | n/a | 189 |
| Fair value reserve | -150 | 0 | n/a | -116 |
| Total comprehensive income for | ||||
| the period | 2,405 | -560 | n/a | 489 |
| Attributable to: | ||||
| Equity holders of the parent | 2,405 | -560 | n/a | 489 |
| STATEMENT OF FINANCIAL POSITION (tEUR) |
30.09.2010 | 30.09.2009 | Change % | 31.12.2009 |
| Non-current assets | ||||
| Property,plant,equipment | 9,020 | 8,520 | 5.9 % | 9,960 |
| Goodwill | 36,914 | 25,999 | 42.0 % | 31,657 |
| Intangible assets | 7,021 | 8,216 | -14.5 % | 7,664 |
| Investments | 713 | 703 | 1.4 % | 713 |
| 53,668 | 43,438 | 23.6 % | 49,994 | |
| Current assets | ||||
| Inventories | 19,623 | 19,876 | -1.3 % | 20,682 |
| Other current assets | 33,438 | 32,120 | 4.1 % | 26,884 |
| Liquid funds | 10,063 | 12,836 | -21.6 % | 12,518 |
| 63,124 | 64,832 | -2.6 % | 60,084 | |
| Total assets | 116,792 | 108,270 | 7.9 % | 110,078 |
| Shareholder's equity and liabilities | ||||
| Share capital | 6,967 | 6,967 | 0.0 % | 6,967 |
| Other equity | 40,902 | 38,544 | 6.1 % | 39,702 |
| Non-controlling interest | 319 | 0 | n/a | 0 |
| 48,188 | 45,511 | 5.9 % | 46,669 | |
| Non-current liabilities | ||||
| Provisions | 513 | 314 | 63.4 % | 513 |
| Non interest bearing liabilities | 10,720 | 2,250 | 376.4 % | 6,726 |
| Interest bearing liabilities | 11,676 | 12,412 | -5.9 % | 12,237 |
| 22,909 | 14,976 | 53.0 % | 19,476 |
| Short-term liabilities | ||||
|---|---|---|---|---|
| Trade payables and other s-t | ||||
| liabilities | 33,212 | 31,043 | 7.0 % | 32,372 |
| Provisions | 1,227 | 1,469 | -16.5 % | 1,026 |
| S-t interest bearing liabilities | 11,256 | 15,271 | -26.3 % | 10,535 |
| 45,695 | 47,783 | -4.4 % | 43,933 | |
| Total shareholder's equity and | ||||
| liabilities | 116,792 | 108,270 | 7.9 % | 110,078 |
| CONSOLIDATED CASH FLOW | ||||
| STATEMENT (tEUR) | 1-9/2010 | 1-9/2009 | Change % | 1-12/2009 |
| Cash flows from operating | ||||
| activities | ||||
| Profit for the period | 2,680 | -579 | n/a | 416 |
| Adjustments | 6,517 | 5,106 | 27.6 % | 8,230 |
| Interest and other financial | ||||
| expenses and incomes | -497 | -539 | -7.8 % | -937 |
| Paid Taxes | -378 | -881 | -57.1 % | -1,708 |
| Change in working capital | -3,805 | -556 | 584.3 % | 3,830 |
| Cash flow from operating activities | 4,517 | 2,551 | 77.1 % | 9,831 |
| Cash flow from investing activities | ||||
| Acquisition of subsidiary, net of | ||||
| cash acquired Purchases of property, plant |
-3,120 | -10,281 | -69.7 % | -10,281 |
| and equipment (PPE) | -620 | -1,258 | -50.7 % | -2,772 |
| Purchases of intangible assets | -1,006 | -924 | 8.9 % | -1,327 |
| Investments in shares | 0 | 0 | n/a | -10 |
| Net cash used in investing | ||||
| activities | -4,746 | -12,463 | -61.9 % | -14,390 |
| Cash flow from financing activities | ||||
| Proceeds from borrowings | 0 | 20,500 | n/a | 20,542 |
| Payments of borrowings | -966 | -4,740 | -79.6 % | -10,623 |
| Dividends paid | -1,364 | -2,035 | -33.0 % | -2,035 |
| Own shares | 0 | -264 | n/a | -264 |
| Proceeds from issuance of | ||||
| ordinary shares | 229 | 0 | n/a | 0 |
| Net cash used in financing | ||||
| activities | -2,101 | 13,461 | n/a | 7,620 |
| Change in cash | ||||
| Cash in the beginning | 12,518 | 9,268 | 35.1 % | 9,268 |
| Change in cash during period | -2,330 | 3,549 | n/a | 3,061 |
| Effect of currency changes | -125 | 19 | n/a | 189 |
| Cash at the end | 10,063 | 12,836 | -21.6 % | 12,518 |
| KEY FIGURES | 1-9/2010 | 1-9/2009 | Change % | 1-12/2009 |
| Earnings per share, EUR | 0.15 | -0.03 | n/a | 0.02 |
| Earnings per share fully diluted, | ||||
| EUR | 0.15 | -0.03 | n/a | 0.02 |
| Shareholders' equity per share, | ||||
| EUR | 2.77 | 2.61 | 5.9 % | 2.68 |
| Return on equity | 7.5 % | -1.7 % | n/a | 0.9 % |
| Return on capital employed | 8.6 % | 0.4 % | 2050.0 % | 3.3 % |
| Equity ratio | 41.5 % | 43.4 % | -4.3 % | 43.6 % |
| Gearing | 26.7 % | 32.6 % | -18.1 % | 22.0 % |
|---|---|---|---|---|
| Investments, tEUR Investments % of net sales Order backlog, tEUR Personnel, average |
9,232 7.6 % 13,271 1,221 |
17,519 17.9 % 30,329 1,090 |
-47.3 % -57.4 % -56.2 % 12.0 % |
25,241 17.8 % 33,100 1,103 |
| Number of shares (thousands) | 18,062 | 17,806 | 1.4 % | 17,806 |
| including own shares Highest share price, EUR Lowest share price, EUR Average share price, EUR |
5.33 3.63 4.44 |
4.30 2.25 3.61 |
24.0 % 61.3 % 23.0 % |
4.30 2.25 3.62 |
| Turnover, in million shares Turnover, in MEUR |
2.6 11.6 |
7.1 25.8 |
-63.5 % -55.1 % |
7.8 28.5 |
| Treasury shares | ||||
| Number of shares |
% of shares |
% of votes |
||
| Teleste companies own shares 30.9.2010 |
760,985 | 4.18 % | 4.18 % | |
| Contingent liabilities and pledged assets (tEUR) |
||||
| For own debt | ||||
| Other securities Leasing and rent liabilities |
120 6,518 6,638 |
120 5,990 6,110 |
0.0 % 8.8 % 8.6 % |
120 6,016 6,136 |
| Derivative instruments (tEUR) | ||||
| Value of underlying forward contracts Market value of forward |
5,285 | 6,962 | -24.1 % | 8,043 |
| contracts | -176 | -236 | -25.4 % | -228 |
| Interest rate swap Market value of interest swap |
11,500 -266 |
0 0 |
n/a n/a |
11,500 -157 |
| Taxes are computed on the basis of the tax on the profit for the period. |
||||
| RECLASSIFICATION OF SEGMENTS 1.1.2010 | ||||
| OPERATING SEGMENTS (tEUR) | 1-9/2010 | 1-9/2009 | Change % | 1-12/2009 |
| Video and Broadband Solutions | ||||
| Order intake | 59,450 | 58,907 | 0.9 % | 81,612 |
| Net sales | 59,159 | 55,264 | 7.0 % | 76,280 |
| EBIT | 3,976 | -235 | n/a | -692 |
| EBIT% Network Services |
6.7 % | -0.4 % | n/a | -0.9 % |
| Order intake | 56,914 | 45,289 | 25.7 % | 69,408 |
| Net sales | 62,034 | 42,603 | 45.6 % | 65,371 |
| EBIT | 489 | 1,041 | -53.0 % | 3,216 |
| EBIT% | 0.8 % | 2.4 % | -67.7 % | 4.9 % |
| Order intake Net sales EBIT EBIT% Financial items |
Share of profit of associates Operating segments net profit |
116,364 121,193 4,465 3.7 % -497 |
0 | 104,196 97,867 806 0.8 % -539 -544 |
11.7 % 23.8 % 453.9 % 347.3 % -7.8 % n/a |
151,020 141,651 2,524 1.8 % -605 -544 |
||||
|---|---|---|---|---|---|---|---|---|---|---|
| before taxes | 3,968 | -277 | n/a | 1,375 | ||||||
| Segment assets reasonable basis. |
Segment assets include items directly attributable as well as those that can be allocated on a | |||||||||
| Network Services Assets total |
Segment assets total Unallocated assets |
Video and Broadband Solutions | 30.9.2010 66,260 40,469 106,729 10,063 116,792 |
30.9.2009 57,212 38,223 95,435 12,836 108,271 |
Change % | 15.8 % 5.9 % 11.8 % -21.6 % 7.9 % |
31.12.2009 56,120 41,440 97,560 12,518 110,078 |
|||
| Information per quarter (tEUR) |
7-9/10 | 4-6/10 | 1-3/10 | 10- 12/09 |
7-9/09 | 10/2009- 9/2010 |
||||
| Video and Broadband Solutions Order intake Net sales EBIT EBIT % |
21,170 19,915 1,955 9.8 % |
19,702 20,148 1,463 7.3 % |
18,578 19,062 562 2.9 % |
22,705 21,015 -457 -2.2 % |
22,508 18,262 1,524 8.3 % |
82,155 80,140 3,523 4.4 % |
||||
| Network Services Order intake Net sales EBIT EBIT % |
18,710 18,710 28 0.2 % |
19,278 23,326 192 0.8 % |
18,926 20,032 264 1.3 % |
24,119 22,769 2,175 9.6 % |
26,136 23,449 84 0.4 % |
81,033 84,837 2,659 3.1 % |
||||
| Total Order intake Net sales EBIT EBIT % |
39,880 38,625 1,984 5.1 % |
38,980 43,474 1,655 3.8 % |
37,504 39,094 826 2.1 % |
46,824 43,784 1,718 3.9 % |
48,644 41,711 1,608 3.9 % |
163,188 164,977 6,183 3.7 % |
||||
| Attri butable to equity holders of the parent (tEUR) Share holder's |
Share capital |
Share premium |
Trans lation diffe rences |
Retai ned earn ings |
Invested free capital |
Other funds |
Total | Share of non cont rolling interest |
Total equity |
|
| equity 1.1.2010 Total compre |
6,967 | 1,504 | -372 | 35,949 | 2,737 | -116 | 46,669 | 0 | 46,669 | |
| hensive income for the period Share issue |
-125 | 2,680 | 0 | -150 | 2,405 0 |
0 289 |
2,405 289 |
|||
| Paid dividend Equity- |
-1,394 189 |
0 | 0 | -1,394 189 |
30 0 |
-1,364 189 |
Total
| settled share based payments Share holder's equity |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| 30.9.2010 | 6,967 | 1,504 | -497 | 37,424 | 2,737 | -266 | 47,869 | 319 | 48,188 |
| Share holder's equity |
|||||||||
| 1.1.2009 Total compre hensive income |
6,967 | 1,504 | -561 | 37,284 | 1,451 | 0 | 46,645 | 0 | 46,645 |
| for the period |
19 | -579 | 0 | -560 | 0 | -560 | |||
| Paid dividend Equity settled |
-2,035 | -2,035 | 0 | -2,035 | |||||
| share based payments Share |
175 | 1,286 | 0 | 1,461 | 0 | 1,461 | |||
| holder's equity |
|||||||||
| 30.9.2009 | 6,967 | 1,504 | -542 | 34,845 | 2,737 | 0 | 45,511 | 0 | 45,511 |
| CALCULATION OF KEY FIGURES | |||||||||
| Return on equity: | Profit/loss for the financial period | ||||||||
| ------------------------------ * 100 Shareholders' equity (average) |
|||||||||
| Return on capital employed: | Profit/loss for the period after financial items + financing charges | ||||||||
| ------------------------------ * 100 liabilities (average) |
Total assets - non-interest-bearing | ||||||||
| Equity ratio: | Shareholders' equity | ||||||||
| ----------------------------- * 100 | Total assets - advances received | ||||||||
| Gearing: | bearing assets | ----------------------------- * 100 | Interest bearing liabilities - cash in hand and in bank - interest | ||||||
| Shareholders' equity | |||||||||
| Earnings per share: | ---------------------------------------------- | Profit for the period attributable to equity holder of the parent | |||||||
| the period | Weighted average number of ordinary shares outstanding during | ||||||||
| Earnings per share, diluted: | Profit for the period attributable to equity holder of the parent (diluted) |
----------------------------------------------- Average number of shares - own shares + number of options at the period-end
| MAJOR SHAREHOLDERS 30.9.2010 | Shares | % |
|---|---|---|
| EM Group Oy | 3,822,813 | 21.02 |
| Mandatum Life | 1,679,200 | 9.23 |
| Ilmarinen Mutual Pension Insurance Company | 936,776 | 5.15 |
| Kaleva Mutual Pension Insurance Company | 824,641 | 4.53 |
| Op-Suomi Small Cap | 596,112 | 3.28 |
| Varma Mutual Pension Insurance Company | 521,150 | 2.87 |
| State Pension Fund | 500,000 | 2.75 |
| Aktia Capital Mutual Fund | 450,000 | 2.47 |
| Skagen Vekst Verdipapierfond | 437,000 | 2.40 |
| Teleste Management Oy | 381,000 | 2.09 |
| SECTOR DISPERSION 30.9.2010 | Shareholders | % | Shares | % |
|---|---|---|---|---|
| Corporations | 315 | 5.93 | 5,825,143 | 32.02 |
| Financial and insurance corporations | 14 | 0.26 | 3,803,077 | 20.91 |
| Public institutions | 9 | 0.16 | 2,290,744 | 12.59 |
| Non-profit institutions | 36 | 0.67 | 366,611 | 2.01 |
| Households | 4,893 | 92.21 | 4,364,078 | 23.99 |
| Foreign countries and nominee registered | 39 | 0.73 | 1,536,937 | 8.45 |
| Total | 5,306 | 100.00 | 18,186,590 | 100.00 |
| HOLDING DISPERSION 30.9.2010 | Shareholders | % | Shares | % |
|---|---|---|---|---|
| 0 - 100 | 1,184 | 22.31 | 82,346 | 0.45 |
| 101 - 1000 | 3,127 | 58.93 | 1,311,221 | 7.20 |
| 1001 - 10000 | 900 | 16.96 | 2,507,053 | 13.78 |
| 10001 - 100000 | 77 | 1.45 | 1,859,781 | 10.22 |
| 100001 - 1000000 | 16 | 0.30 | 6,924,176 | 38.07 |
| 1000001 - | 2 | 0.03 | 5,502,013 | 30.25 |
| Total | 5,306 | 100.00 | 18,186,590 | 100.00 |
Preliminary calculation of recognised fair values on the acquisition Freycom:
| 1,000 EUR Fair values used in consolidation |
Recognised fair values on acquisition |
|---|---|
| Trade marks (inc. in intangible assets) | 62 |
| Customer relationship (inc. in intangible assets) | 172 |
| Book values used in consolidation | |
| Tangible assets | 107 |
| Inventories | 280 |
| Other receivables | 215 |
| Cash and cash equivalents | 340 |
| Total assets | 1,176 |
| Book values used in consolidation | |
| Deferred tax liabilities | 60 |
| Other liabilities | 668 |
| Total liabilities | 728 |
| Net identifiable assets and liabilities | 448 |
|---|---|
| Total consideration | 571 |
| Goodwill on acquisition | 123 |
| Consideration paid in cash | -571 |
| Cash and cash equivalents in acquired subsidiary | 340 |
| Total net cash outflow on the acquisition | -231 |
Preliminary calculation of recognised fair values on the acquisition Satlan:
| tEUR | Recognised fair values on acquisition |
|---|---|
| Fair values used in consolidation | |
| Trade marks (inc. in intangible assets) | 154 |
| Customer relationship (inc. in intangible assets) | 843 |
| Inventories | 1,314 |
| Book values used in consolidation | |
| Tangible assets | 51 |
| Trade receivables | 1,305 |
| Other receivables | 219 |
| Cash and cash equivalents | 333 |
| Total assets | 4,219 |
| Book values used in consolidation | |
| Deferred tax liabilities | 259 |
| Other liabilities | 2,363 |
| Total liabilities | 2,622 |
| Net identifiable assets and liabilities | 1,597 |
| Total consideration | 6,330 |
| Goodwill on acquisition | 4,733 |
| Consideration paid in cash | -2,780 |
| Cash and cash equivalents in acquired subsidiary | 333 |
| Total net cash outflow on the acquisition | -2,447 |
P.O.Box 323, FI-20101 Turku, Finland Seponkatu 1, FI-20660 Littoinen, Finland Phone +358 2 2605 611 (switchboard) [email protected] Business ID 1102267-8 www.teleste.com
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