Earnings Release • Aug 16, 2016
Earnings Release
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TKH Group N.V. (TKH) First half results 2016
Outlook for the full year 2016: a net profit before amortization and one-off income and expenses attributable to shareholders of between € 88 and € 93 million (2015: € 99.9 million).
| (in € million unless otherwise stated) | Q2 2016 |
Q2 2015 |
Change in % |
|---|---|---|---|
| Turnover 1) | 333.3 | 356.7 | - 6.6 |
| EBITA | 33.6 | 37.8 | - 11.2 |
| Net profit before amortization2) and one-off income | |||
| and expenses, attributable to shareholders | 21.5 | 24.4 | - 12.1 |
| Net profit | 18.8 | 21.3 | - 12.0 |
| ROS | 10.1% | 10.6% |
| (in € million unless otherwise stated) | H1 2016 | H1 2015 | Change in % |
|---|---|---|---|
| Turnover 1) | 650.1 | 690.0 | - 5.8 |
| EBITA | 64.8 | 73.8 | - 12.3 |
| Net profit before amortization2) and one-off income | |||
| and expenses, attributable to shareholders | 41.0 | 47.0 | - 12.8 |
| Net profit | 35.9 | 41.3 | - 13.2 |
| Net earnings per ordinary share attributable to | |||
| shareholders (in €) | 0.83 | 0.97 | - 14.4 |
| Solvency ratio | 44.2% | 40.2% | |
| ROS | 10.0% | 10.7% | |
| ROCE | 18.6% | 20.1% |
1) The item 'movements in inventories finished products and work in progress' was reclassified in 2015 and is now recognized as operating expenses instead of net turnover.
2) Of intangible fixed assets related to acquisitions (after taxes).
Alexander van der Lof, CEO of technology company TKH: "The decline in the results in the second quarter was in line with the previous reported reduced order intake from China in the manufacturing systems sub-segment . The situation in China did not improve in the second quarter due to the postponement of a number of expected orders, also from the big five tire manufacturers. The outlook for the order intake in the second half of the year is better, due to a number of newly announced large-scale projects in which TKH is well positioned. In the second quarter, we were able to agree on a framework agreement with a major tire manufacturer. We have further adjusted our production capacity upwards with a view to the expected higher activity levels in the coming quarters. We also made a number of breakthroughs in the Building and Telecom Solutions segments and closed some major contracts that will result in an increase of turnover. The investments in R&D within Building Solutions were increased to accelerate the completion of a number of large R&D projects on the basis of positive feedback from pilot projects. Great interest is shown by customers in the form of concrete orders for the new technologies, including CEDD, machine vision, subsea-connectivity and light truck tire building systems. Investments in preparation for the targeted growth within the vertical growth markets create a lot of confidence for the future but are having a slightly negative impact on short-term ROS."
Turnover declined by € 23.4 million (6.6%) to € 333.3 million in the second quarter of 2016 (2015: € 356.7 million). The divestment of Parking & Protection resulted in a 0.4% decline in turnover. The on average weaker foreign currencies against the euro had a negative impact of 1.0% on turnover. Lower raw materials prices had a negative impact of 2.0% on turnover. On balance, the organic turnover decline was 3.2%.
The turnover decline in the second quarter was due entirely to Industrial Solutions and is a consequence of a lower order intake in the manufacturing systems sub-segment in recent quarters. The other segments, Telecom and Building Solutions, realized organic growth of 11.8% and 2.6% respectively.
The operating result before amortization of intangible assets and one-off income and expenses (EBITA) declined by 11.2% in the second quarter of 2016 to € 33.6 million (€ Q2 2015: € 37.8 million). Both Building Solutions' and Telecom Solutions' EBITA came in higher than in the second quarter of 2015, while Industrial Solutions recorded a clear decline in EBITA.
Net profit before amortization and one-off income and expenses attributable to shareholders fell by 12.1% to € 21.5 million (Q2 2015: € 24.4 million), as a result of the lower operating result.
The ROS for TKH came in at 10.1% in the second quarter of 2016 (Q2 2015: 10.6%).
Turnover declined by 5.8% to € 650.1 million in the first half of 2016 (H1 2015: € 690.0 million). The divestment of Parking & Protection resulted in a drop in turnover in the first half year of 0.4%. Both weaker foreign currencies against the euro and a drop in raw materials prices had a negative impact on turnover of 0.7% and 1.8% respectively. The organic turnover decline was 3.0%.
The contribution from Industrial Solutions to overall turnover dropped to 44.9% in the first half year, from 46.7% in the year-earlier period. The contribution from Building Solutions was up slightly at 42.1%, from 41.7% of total turnover. The contribution from Telecom Solutions rose to 13.0%, from 11.7%.
The gross margin increased to 46.4% in the first half of 2016, from 46.0% in the first half of 2015. The higher margin was realized in Building and Industrial Solutions on the back of an improved product mix.
Operating costs were down 2.6% compared to the first half of 2015. However, operating costs as a percentage of turnover rose to 36.5% in the first half of 2016, from 35.3% in the first half of 2015. This relative increase was largely due to lower turnover levels in the manufacturing systems sub-segment, while investments in the required expansion of the organization in a number of specific vertical growth markets in the area of R&D, commerce and production capacity were higher.
Depreciations came in at € 10.1 million, down from € 10.9 million in the first half of 2015.
The operating result before amortization of intangible assets and one-off income and expenses (EBITA) fell by 12.3% to € 64.8 million in the first half of 2016, from € 73.8 million in the first half of 2015. EBITA in Telecom Solutions was up 16.0% compared to the first half of 2015. In Building Solutions, EBITA was down 3.7%, while Industrial Solutions recorded a drop in EBITA of 23.2%.
ROS fell to 10.0% in the first half of 2016, from 10.7% in the first half of 2015.
Amortization costs increased by € 0.5 million to € 15.9 million (H1 2015: € 15.4 million), due to higher investments in R&D made in recent years.
The financial result improved with € 2.0 million to a net amount of € 2.4 million in the first half of 2016. Interest expenses were € 0.8 million lower and a reduction in the negative currency exchange effects resulted in an improvement of € 0.9 million. The result from participations was up € 0.3 million.
The tax rate was 21.7% in the first half of 2016, compared with € 22.6% in the same period of 2015. The use of the Dutch innovation box facility once again had a positive impact on the overall tax rate.
Net profit before amortization and one-off income and expenses attributable to shareholders was down 12.8% at € 41.0 million in the first half of 2016 (H1 2015: € 47.0 million). Net profit fell to € 35.9 million in the first half of 2016 (H1 2015: € 41.3 million).
Net bank debt, calculated in accordance with the covenants agreed with the banks, increased by € 46.0 million from year-end 2015, to € 207.0 million. This increase was due to dividend payments, investments and the higher working capital due to seasonal effects. The net debt/EBITDA ratio came in at 1.3 and the interest coverage ratio stood at 23.7. This means that TKH is operating well within the bandwidth of the financial ratios agreed with its banks. The solvency ratio stood at 44.2% (H1 2015: 40.2%). Working capital increased to 14.4% at 30 June 2016, from 11.4% at year-end 2015, due to seasonal effects, but was considerably lower when compared to mid-2015 (18.2%).
At 30 June 2016, TKH had a total workforce (FTEs) of 5,433 (mid-2015: 5,337) and employed an additional 405 temporary staff at 30 June 2016 (mid-2015: 478).
Telecom Solutions develops, produces and supplies systems ranging from basic outdoor infrastructure for telecom and CATV networks through to indoor home networking applications. The focus of the business is on the delivery of completely worry-free systems for its clients, thanks to the system guarantees it provides. Around 60% of the portfolio consists of hub-to-hub optical fibre and copper cable systems. The remaining 40%, consisting of components and systems in the field of connectivity and peripherals, is deployed primarily in network hubs
(in € million unless otherwise stated)
| H1 2016 | H1 2015 | Change in % |
||
|---|---|---|---|---|
| Turnover 1) | 84.1 | 80.4 | + | 4.5 |
| EBITA | 9.2 | 8.0 | + | 16.0 |
| ROS | 11.0% | 9.9% | ||
| 1) |
The item 'movements in inventories finished products and work in progress' was reclassified in 2015 and is now recognized under operating costs instead of net turnover.
Turnover in the Telecom Solutions segment was up 4.5% at € 84.1 million. Currency exchange rates had a negative impact of 1.1% on turnover. Organic turnover growth was 5.6%. The organic turnover growth was realized in fibre network systems. The demand for optical fibre systems in the Netherlands and Poland declined, but this was more than offset by strong demand for optical fibre in China and growth in Germany and France.
EBITA was up 16.0% at € 9.2 million. ROS improved to 11.0%, from 9.9%, on the back of a higher capacity utilization rate in optical fibre production and higher added value in the indoor telecom systems sub-segment due to an improved product mix.
Turnover was down 2.2% due to a continued decline in investment levels in copper networks. Indoor telecom is seeing growing demand, driven by higher consumer spending in the European market. The margin came in higher as a result of an improved product mix.
Turnover was up by 10.5% despite a decline in demand in the Netherlands and Poland. In the Netherlands, the decline in demand is still not being offset by the installation of fibre optic networks in rural areas. In Poland, the decline in European subsidies had a negative impact on the willingness to invest. However, TKH recorded turnover growth in China, Germany and France. The higher capacity utilization level and the realized efficiency improvements had a positive impact on the result.
Building Solutions develops, produces and delivers solutions in the field of efficient electrotechnical technology, ranging from applications within buildings to technical systems which, linked to software, provide efficiency solutions for the care and security sectors. TKH's know-how in this segment is focused on vision technology and connectivity systems combined with efficiency solutions to reduce the throughput time for the realization of installations within buildings and industrial automation. In addition, TKH's focus in this segment is on intelligent video, intercom and access monitoring systems for a number of specific sectors, including elderly care, parking, marine, the oil & gas industry, tunnels and security for buildings and work sites.
| H1 2016 | H1 2015 | Change in % |
||||||
|---|---|---|---|---|---|---|---|---|
| Turnover 1) | 274.0 | 287.5 | - | 4.7 | ||||
| EBITA | 28.9 | 30.0 | - | 3.7 | ||||
| ROS | 10.6% | 10.4% | ||||||
| 1) |
The item 'movements in inventories finished products and work in progress was reclassified in 2015 and is now recognized as operating expenses instead of net turnover.
Turnover in the Building Solutions segment fell by 4.7% to € 274.0 million, of which 0.9% is a result of the divestment of Parking & Protection. Currency exchange rates had a negative impact of 1.0% on turnover. In addition, lower raw materials prices had a negative impact of 2.3% on turnover. On balance, the organic drop in turnover came in at 0.5% in the first half year. A reluctance to invest had a negative impact on turnover in China and Poland. Organic turnover growth was 2.6% in the second quarter.
EBITA fell 3.7% to € 28.9 million, as a result of the drop in turnover. ROS improved slightly to 10.6% in the first half of 2016 (H1 2015: 10.4%).
Organic turnover decreased 0.1%. The reluctance to invest in China and Poland had a negative impact on turnover. On the other hand, turnover was up in Europe, primarily in the security segment. Turnover in parking solutions increased due to a growing demand for efficient and intelligent parking systems, based on vision technology.
The introduction of new, advanced vision-technology for the automation and inspection of production processes, in response to ever higher specifications, resulted in the first contracts. On the basis of feedback from customers, we see considerable potential for innovation within our vision technology, confirming our growth targets for the vertical growth market machine vision.
Connectivity systems - specialty cable (systems) for marine, rail, infrastructure, wind energy, as well as installation and energy cable for niche markets – turnover share 16.6% Turnover fell organically by 1.1%. This was the result of a drop in market volume due to fewer large-scale projects in the construction and infra sector, as well as a drop in the marine, oil & gas markets. On the other hand, turnover was up in energy and data cable systems. Due to TKH's strong focus on margins and efficiency improvements, both added value and the result came in higher. The new plant for subsea cable systems was commissioned in the first half of 2016. In the second quarter, TKH started pilot productions. Series production is expected to start in the first quarter of 2017.
Industrial Solutions develops, produces and delivers solutions ranging from specialty cable, plug and play cable systems to integrated systems for the production of car and truck tires. The company's know-how in the automation of production processes and improvements in the reliability of production systems gives TKH the differentiating potential to respond to the increasing desire to outsource the construction of production systems or modules in a number of specialized industrial sectors, such as tire manufacturing, robotics, medical and machine building industries.
(in € million unless otherwise stated)
| H1 2016 | H1 2015 | Change in % |
|
|---|---|---|---|
| Turnover 1) | 292.1 | 322.0 | - 9.3 |
| EBITA | 32.8 | 42.7 | - 23.2 |
| ROS | 11.2% | 13.3% | |
| 1) |
The item 'movements in inventories finished products and work in progress was reclassified in 2015 and is now recognized as operating expenses instead of net turnover.
Turnover in the Industrial Solutions segment fell by 9.3% to € 292.1 million. Currency exchange rates had a negative impact of 0.2% on turnover. Turnover was down 1.8% due to lower average raw materials prices. Turnover fell by 7.3% organically. The drop in turnover was due entirely to the sub-segment manufacturing systems and was related to the previously reported lower order intake in 2015, which was in turn due to reluctance to invest in China. Turnover in the connectivity systems sub-segment developed positively and grew organically by 7.2%.
EBITDA was down 23.2% at € 32.8 million as a result of lower turnover and production capacity utilization, as well as investments in capacity expansion and higher R&D expenses. This in turn reduced ROS to 11.2% in the first half of 2016, from 13.3% in the first half of 2015.
Organic turnover growth came in at 7.2%. This turnover growth was realized in the medical and robot industries. Investments in R&D, making it possible for TKH to respond optimally to the trend of miniaturization and extending the life time of cable systems for advanced production systems, are clearly bearing fruit in these areas. The strong increase in the demand for robot systems is also having a positive impact on this front.
Turnover declined organically by 16.2%. This decline was the result of the reduced order intake in 2015 and the effect of a relatively large share in engineering activities prior to production as a consequence of new developed technology and continued breakthroughs among the top five tire manufacturers. TKH continued to increase production capacity in the second quarter in order to meet the expected increase in production levels in the second half of 2016. The reluctance to invest in China still has a negative impact on the order intake. In the second quarter, we saw the postponement of a number of projects, which resulted in a relatively low level of order intake of € 50 million. Despite the low order intake, the order book is well-filled, which will result in a higher production value in the coming quarters. In the second quarter, the tire manufacturing industry announced a number of major projects, for which TKH is well positioned and which may result in order intake.
The outlook for the second half of the year in the market segments in which TKH operates, shows generally a more positive picture.
In Telecom Solutions, we expect turnover in line with the first half year. The demand for optical fibre in China will be lower in the second half of 2016, but we expect that this will be largely compensated by higher demand in Europe. We expect a different geographical distribution of turnover to lead to a lower result than in the first half of the year.
In Building Solutions, turnover will develop positively in the second half of the year. The order book and order intake in both connectivity and vision & security are at healthy levels and the outlook for potential orders is overall positive. On balance, we expect the result in the second half of the year to be higher than in the first six months.
In Industrial Solutions, turnover will be higher as a result of the well-filled order book in both connectivity and manufacturing systems. We expect the order intake for manufacturing systems in the second half of the year to exceed that of the first half year. We expect the result to be higher in the second half of the year than in the first half year.
On balance, and barring unforeseen circumstances, TKH expects net profit before amortization and one-off income and expenses attributable to shareholders of between € 88 million and € 93 million for the full year 2016 (2015: € 99.9 million).
Haaksbergen, 16 August 2016
Executive Board
For more information: J.M.A. (Alexander) van der Lof Chairman of the Executive Board Tel. + 31 (0)53 5732903 Website: www.tkhgroup.com
3 November 2016 Trading update Q3 2016 7 March 2017 Publication full year results 2016 2 May 2017 Trading update Q1 2017 3 May 2017 General Meeting of Shareholders 15 August 2017 Publication half year results 2017 2 November 2017 Trading update Q3 2017
Technology firm TKH Group NV (TKH) is an internationally operating group of companies that specializes in developing and delivering innovative Telecom, Building and Industrial Solutions.
In doing so, TKH contributes to a safe environment and efficient, reliable processes for its customers.
The TKH core technologies -vision & security, communication, connectivity and manufacturing systems- are linked into total systems and solutions in our three Solutions segments. In this, we strive for far-reaching synergy and co-operation between our subsidiaries.
TKH has a thorough knowledge of processes and technologies, as well as insight into its customers' markets and processes. We offer our customers tailor-made solutions by making optimal use of our specialists' know-how in the fields of R&D, engineering, marketing, process development, project management and logistics.
TKH strives for strong market positions based chiefly on its own high-quality technologies and services, with an extensive regional and international spread. TKH and its subsidiaries operate on a global scale. Its growth is concentrated in Europe, North America and Asia. Employing 5,387 people, TKH achieved a turnover of €1.4 billion in 2015.
in thousands of euros
| 1 | st half year 2016 | st half year 2015 1 |
||
|---|---|---|---|---|
| Net turnover1) Other operating income |
649,113 1,015 |
689,129 854 |
||
| Total turnover | 650,128 | 689,983 | ||
| Changes in inventory of finished goods and work in progress 1) Raw materials, consumables, trade products |
788 | -283 | ||
| and subcontracted work Personnel expenses Depreciation |
347,493 163,488 10,098 |
373,153 164,168 10,865 |
||
| Amortization Impairments Other operating expenses |
15,946 529 63,494 |
15,454 497 68,251 |
||
| Total operating expenses | 601,836 | 632,105 | ||
| Operating result | 48,292 | 57,878 | ||
| Financial income Financial expenses Exchange differences Share in result of associates |
1,058 -4,325 14 821 |
789 -4,856 -905 534 |
||
| Financial result | -2,432 | -4,438 | ||
| Result before taxes | 45,860 | 53,440 | ||
| Tax on profit | 9,966 | 12,100 | ||
| Net result from continued operations | 35,894 | 41,340 | ||
| Profit on discontinued operations | 0 | 0 | ||
| Net result | 35,894 | 41,340 | ||
| Attributable to: Shareholders of the company Non-controlling interests |
34,850 1,044 35,894 |
40,332 1,008 41,340 |
||
| Earnings per share attributable to shareholders Weighted average number of shares (x 1,000) Weighted average number of shares for the purpose of diluted earnings per share (x 1,000) |
41,868 42,086 |
41,446 41,637 |
||
| Ordinary earnings per share before amortization (in €) Ordinary earnings per share (in €) Diluted earnings per share (in €) |
0.98 0.83 0.83 |
1.13 0.97 0.97 |
1) The line item 'Changes in inventory of finished goods and work in progress' has been reclassified from turnover to expenses. The comparative figures have been restated.
in thousands of euros
| st half year 2016 1 |
1 | st half year 2015 | ||
|---|---|---|---|---|
| Net result | 35,894 | 41,340 | ||
| Items that will not be reclassified subsequently to profit or loss (net of tax) |
||||
| Actuarial gains/(losses) | 0 | -59 | ||
| 0 | -59 | |||
| Items that may be reclassified subsequently to profit or loss (net of tax) |
||||
| Currency translation differences | -3,513 | 12,906 | ||
| Effective part of changes in fair value of cash flow | ||||
| hedges (after tax) | 1,172 | 318 | ||
| (De)/revaluation of available-for-sale financial assets | -710 | 1,682 | ||
| -3,051 | 14,906 | |||
| Other comprehensive income (net of tax) | -3,051 | 14,847 | ||
| Comprehensive income for the period (net of tax) | 32,843 | 56,187 | ||
| Attributable to: | ||||
| Shareholders of the company | 31,795 | 55,148 | ||
| Non-controlling interests | 1,048 | 1,039 | ||
| Total comprehensive income for the period (net of | ||||
| tax) | 32,843 | 56,187 |
in thousands of euros
| 30-06-2016 | 31-12-2015 | |||
|---|---|---|---|---|
| Assets | ||||
| Non-current assets | ||||
| Intangible non-current assets | 393,115 | 400,264 | ||
| Tangible non-current assets | 201,722 | 192,186 | ||
| Investment property | 3,635 | 3,658 | ||
| Financial non-current assets | 22,754 | 22,754 | ||
| Deferred tax assets | 12,885 | 11,573 | ||
| Total non-current assets | 634,111 | 630,435 | ||
| Current assets | ||||
| Inventories | 206,084 | 194,240 | ||
| Receivables | 191,912 | 170,377 | ||
| Amounts due from customers under construction contracts |
74,751 | 74,160 | ||
| Current income tax | 3,751 | 2,555 | ||
| Cash and cash equivalents | 81,539 | 178,955 | ||
| Total current assets | 558,037 | 620,287 | ||
| Total assets | 1,192,148 | 1,250,722 | ||
| Group equity Shareholders' equity Non-controlling interests |
518,305 8,104 |
520,847 8,570 |
||
| Total group equity | 526,409 | 529,417 | ||
| Non-current liabilities | ||||
| Non-current liabilities | 244,633 | 223,073 | ||
| Deferred tax liabilities | 49,912 | 51,127 | ||
| Retirement benefit obligation | 6,892 | 7,204 | ||
| Financial liabilities | 22,996 | 26,089 | ||
| Provisions Total non-current liabilities |
3,657 | 328,090 | 3,700 | 311,193 |
| Current liabilities | ||||
| Borrowings | 53,138 | 126,234 | ||
| Trade payables and other payables | 226,194 | 209,357 | ||
| Amounts due to customers under construction contracts |
39,372 | 54,136 | ||
| Current income tax liabilities | 9,303 | 10,480 | ||
| Financial liabilities | 1,116 | 577 | ||
| Provisions | 8,526 | 9,328 | ||
| Total current liabilities | 337,649 | 410,112 | ||
| Total equity and liabilities | 1,192,148 | 1,250,722 |
in thousands of euros
| st half 1 |
st half 1 |
|
|---|---|---|
| year 2016 |
year 2015 |
|
| Cash flow from operating activities | ||
| Operating result | 48,292 | 57,878 |
| Depreciation, amortization and impairment | 26,573 | 26,816 |
| Share and option schemes not resulting in a cash flow | 2,018 | 1,606 |
| Changes in provisions | -1,157 | -3,758 |
| Changes in working capital | -30,617 | -51,548 |
| Cash flow from operations | 45,109 | 30,994 |
| Interest paid | -3,267 | -4,067 |
| Income taxes paid | -14,866 | -14,756 |
| Net cash flow from operating activities (A) | 26,976 | 12,171 |
| Cash flow from investing activities Dividends received from non-controlling associates |
653 | 551 |
| Loans | -832 | |
| Investments and divestments of tangible non-current assts | -22,619 | -17,597 |
| Investments and divestments of investment property | -7 | -62 |
| Divestments assets held for sale | 3,050 | |
| Acquisition of subsidiaries | -46,078 | |
| Divestments of subsidiaries | 2,182 | |
| Acquisition of associates | -2,400 | |
| Investment in intangible non-current assets | -13,256 | -11,499 |
| Net cash flow from investing activities (B) | -33,879 | -74,035 |
| Cash flow from financing activities | ||
| Dividends paid | -33,865 | -28,548 |
| Capital contribution by non-controlling interests | 42 | |
| Settlement of financial liabilities regarding put options of non | -273 | |
| controlling interests and earn-out | ||
| Acquisition of non-controlling interests Sold shares for share and option schemes |
-134 -3,870 |
-25,296 -4,731 |
| Proceeds from long-term debts | 21,560 | 74,023 |
| Change in borrowings | 12,916 | 13,869 |
| Net cash flow from financing activities(C ) | -3,666 | 29,359 |
| Net decrease in cash- and cash equivalents (A+B+C) | -10,569 | -32,505 |
| Exchange differences | -835 | -749 |
| Change in cash and cash equivalents | -11,404 | -33,254 |
| Cash and cash equivalents at 1 January 1) | 64,701 | 90,332 |
| Cash and cash equivalents at 30 June 1) | 53,297 | 57,078 |
1) Short term borrowings that are part of a cash pool have been netted against cash and cash equivalents.
| Balance at 1 January 2015 10,511 85,219 35,731 874 2,802 16,155 -4,625 253,263 82,822 482,752 17,174 499,926 Net result 0 0 0 0 0 0 0 0 40,332 40,332 1,008 41,340 Total other comprehensive income 0 0 0 0 1,682 12,875 -34 293 0 14,816 3 1 14,847 Total comprehensive income 0 0 0 0 1,682 12,875 -34 293 40,332 55,148 1,039 56,187 Appropriation profit last year 0 0 0 0 0 0 0 82,822 -82,822 0 0 Dividends 9 6 -96 0 0 0 0 0 -28,044 0 -28,044 0 -28,044 Dividends to shareholdes of non-controlling interests 0 0 0 0 0 0 0 -504 0 -504 0 Capital contribution 0 0 0 0 0 0 0 0 0 0 4 2 Acquisition of non-controlling interests 0 0 0 0 0 0 0 -18,011 0 -18,011 -10,406 -28,417 Share and option schemes (IFRS 2) 0 0 0 0 0 0 0 1,606 0 1,606 0 1,606 Purchased shares for share- and option |
Tot al g rou p |
|---|---|
| 0 | |
| -504 4 2 |
|
| schemes 0 0 0 0 0 0 0 -9,085 0 -9,085 0 -9,085 |
|
| Sold shares for share- and option schemes 0 0 0 0 0 0 0 4,354 0 4,354 0 4,354 |
|
| Change in legal reserve for participations for | |
| which economic ownership is acquired, but not legal ownership 0 0 -157 0 0 0 0 157 0 0 0 |
0 |
| Capitalized development costs 0 0 4,639 0 0 0 0 -4,639 0 0 0 |
0 |
| Balance at 30 June 2015 10,607 85,123 40,213 874 4,484 29,030 -4,659 282,212 40,332 488,216 7,849 496,065 |
|
| Balance at 1 January 2016 10,607 85,123 34,917 874 4,162 20,920 -3,637 281,727 86,154 520,847 8,570 529,417 |
|
| Net result 0 0 0 0 0 0 0 0 34,850 34,850 1,044 35,894 |
|
| Total other comprehensive income 0 0 0 0 -710 -3,517 1,172 0 0 -3,055 4 -3,051 |
|
| Total comprehensive income 0 0 0 0 -710 -3,517 1,172 0 34,850 31,795 1,048 32,843 |
|
| Appropriation profit last year 0 0 0 0 0 0 0 86,154 -86,154 0 0 |
0 |
| Dividends 102 -102 0 0 0 0 0 -32,021 0 -32,021 0 -32,021 |
|
| Dividends to shareholdes of non-controlling interests 0 0 0 0 0 0 0 -369 0 -369 -1,475 -1,844 |
|
| Acquisition of non-controlling interests 0 0 0 0 0 0 0 -95 0 -95 -39 |
-134 |
| Share and option schemes (IFRS 2) 0 0 0 0 0 0 0 2,018 0 2,018 0 2,018 |
|
| Purchased shares for share- and option | |
| schemes 0 0 0 0 0 0 0 -8,278 0 -8,278 0 -8,278 |
|
| Sold shares for share- and option schemes 0 0 0 0 0 0 0 4,408 0 4,408 0 4,408 Change in legal reserve for participations for |
|
| which economic ownership is acquired, but | |
| not legal ownership 0 0 -965 0 0 0 0 965 0 0 0 Capitalized development costs |
0 |
| 0 0 3,773 0 0 0 0 -3,773 0 0 0 Balance at 30 June 2016 10,709 85,021 37,725 874 3,452 17,403 -2,465 330,736 34,850 518,305 8,104 526,409 |
0 |
The interim financial report has been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 December 2015. The accounting principles applied for the valuation of assets and liabilities and the determination of result are the same as those applied in the consolidated financial statements as at and for the year ended 31 December 2015.
The preparation of the condensed consolidated interim financial statements 2015 requires from management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates. The key sources of estimation uncertainly were the same as those that applied to the consolidated financial statements as at and for the year ended 31 December 2015.
The number of outstanding (depositary receipts of) shares as per 31 December 2015 was the equivalent of 41,727,979. Due to the exercise of options rights and share schemes, a balance of 18,112 (depositary receipts of) shares were delivered and sold in the first half of 2016. In addition, a stock dividend of 408,249 (depositary receipt of) shares was paid out from the share premium reserve. As a result, the number of (depositary receipts of) shares outstanding with third parties as per 30 June 2016 was 42,154,340.
At the General Meeting of Shareholders 2016 the dividend over 2015 was declared at € 1.10 per (depositary receipts of) ordinary share. The dividend was proposed at the option of shareholders in cash or as stock dividend. The dividend on the priority shares was declared at € 0.05 per share. The total amount in dividends paid in the first half of 2016 was € 32,020,944 and this amount was charged to the other reserves. For stock dividend an amount of € 102,062 was charged against the premium reserve.
| in thousands of euros | Telecom Solutions |
Building | Solutions | Industrial | Solutions | Not Attributable |
Total | |||
|---|---|---|---|---|---|---|---|---|---|---|
| H1 2016 | H1 2015 | H1 2016 | H1 2015 | H1 2016 | H1 2015 | H1 2016 | H1 2015 | H1 2016 | H1 2015 | |
| st half year Turnover 1 |
84,101 | 80,443 | 273,963 | 287,525 | 292,064 | 322,015 | 0 | 0 | 650,128 | 689,983 |
| Segment EBITA 1) Amortization |
9,230 -402 |
7,957 -374 |
28,918 -12,196 |
30,025 -12,360 |
32,809 -3,319 |
42,711 -2,637 |
-6,190 -29 |
-6,864 -83 |
64,767 -15,946 |
73,829 -15,454 |
| One-off income and expenses2) Segment operating result |
0 8,828 |
0 7,583 |
-343 16,379 |
211 17,876 |
-186 29,304 |
-708 39,366 |
0 -6,219 |
0 -6,947 |
-529 48,292 |
-497 57,878 |
| Financial income and expenses Share of result in associates Tax on profit Net result |
-3,253 821 -9,966 35,894 |
-4,972 534 -12,100 41,340 |
1) EBITA: Operating result before amortization and impairment of non-current assets
2) One off income and expenses relate to an impairment of fixed assets (€ 0.2 million), certain capitalized R&D projects (€ 0.7 million) and a release of a provision for put-options (€ 0.2 million)
| st half 1 |
st half 1 |
|
|---|---|---|
| year | year | |
| in thousands of euros | 2016 | 2015 |
| Net profit attributable to shareholders of the company | 34,850 | 40,332 |
| Net profit attributable to non-controlling interests | 1,044 | 1,008 |
| Net result | 35,894 | 41,340 |
| Amortization of acquisition related intangible non-current assets | ||
| based on preliminary "purchase price allocations" | 7,897 | 8,656 |
| Taxes on the amortizations | -2,146 | -2,334 |
| One-off income and expenses | 529 | 497 |
| Tax on one-off income and expenses | -132 | -124 |
| Net result before amortization and one-off income and | ||
| expenses | 42,042 | 48,035 |
| Attributable to non-controlling interests | -1,044 | -1,008 |
| Ordinary earnings before amortization and one-off income and | ||
| expenses attributable to shareholders of the company | 40,998 | 47,027 |
Early January TKH decided to divest its 51% stake in Parking & Protection B.V. ("P&P"). P&P focuses on the management and operations of parking facilities, particularly for hospitals and urban environments. The activities belong to the Building Solutions segment of TKH and are considered non-core, whereas the focus of TKH is on developing advanced own technologies and offering total solutions. TKH will further concentrate its activities on providing technology solutions for parking. The interest has been sold to Interparking Netherlands B.V. end March.
The transaction has no material impact on the earnings per share of TKH. In 2015 P&P realized a turnover of € 5.7 million and a net profit of € 0.3 million with 31 employees (FTEs). The results of P&P over 2016 till divestment of the interest has been disclosed as 'discontinued activities' and therefore are not included in the consolidated figures. The result on the divestment is nil due to a recognized provision for guarantees provided to the buyer.
The contingent liabilities which are not reflected in the balance sheet, as reported in the financial statements for 2015, have not essentially changed in the first half 2016.
On 1 August 2016, TKH has reached agreement with HELLA KGaA Hueck & Co. ("HELLA") from Germany concerning the acquisition of the HELLA Airport Lighting business. The activities acquired comprises a market leading Airfield Ground Lighting ("AGL") portfolio based on innovative LED technology. The acquisition strengthens the strategic activities of TKH in its vertical growth market Tunnel & Infra. TKH and HELLA have already been successfully cooperating in the development and design of the CEDD (Contactless Energy & Data Distribution) technology of TKH, whereby the lighting fixtures of HELLA are part of the solution.
TKH has taken over the operating side in Nykøbing Falster (Denmark) and main assets from HELLA in Lippstadt (Germany), including intellectual property rights for AGL products. The Airport Lighting activities realized a turnover of about € 7 million in the financial year 204/2015.
The HELLA Airport Lighting activities will be part of TKH's sub segment connectivity systems, within the business segment Building Solutions.
The purchase of € 0.7 million (excluding cash and cash equivalent obtained in the acquisition) is due in cash. The purchase method of accounting has not taken place yet due to the short timeframe. Consequently the precise amount of goodwill and acquired fair values of the assets and liabilities has not been finally determined. The goodwill will not be
deductable for income taxes. The acquisition of the airfield lighting activities will result in an increase of investments in the portfolio and the organization (commercial, R&D and production). As from 2018, the acquisition is expected to contribute positively to the earnings per share of TKH.
Except for the event mentioned, no events of fundamental significance for insight into the financial statements and the preceding period occurred after balance sheet date.
In our Annual Report 2015 we have extensively described certain risk categories and risk factors which could have an (adverse) impact on our financial position and results. Per 30 June the risk categories and risk factors have been reanalyzed and is concluded that these are still applicable.
This report contains the interim financial report of TKH Group NV. The interim financial report ended 30 June 2016 consists of the condensed consolidated interim financial statements, the interim director's report and Executive Board declaration. The information in this interim financial report is unaudited. The condensed consolidated interim financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the consolidated financial statements of TKH for the year ended 31 December 2015.
The Executive Board hereby declares that to the best of their knowledge, the interim financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole, and the interim director's report gives a fair review of the information required pursuant to section 5:25d (8)/(9) of the Dutch Financial Markets Supervision Act (Wet op het financieel toezicht).
Haaksbergen, 16 August 2016
Executive Board J.M.A. van der Lof MBA, chairman E.D.H. de Lange MBA A.E. Dehn
The figures in the interim financial report have not been audited.
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