07:00 London, 09:00 Helsinki, 10 November 2011 - Ruukki Group Plc ("Ruukki" or
"the Company") (LSE: RKKI, OMX: RUG1V) Interim Report
RUUKKI GROUP PLC'S Q3 INTERIM REPORT FOR 1 JULY-30 SEPTEMBER 2011
HIGHLIGHTS
- Production increased by 176% to 86,401 (Q3/2010: 31,257) tonnes
- Revenue from continuing operations increased 46.1% to EUR 42.4 (Q3/2010:
29.0) million
- EBITDA from continuing operations was EUR -2.7 (Q3/2010: -1.6) million and the
EBITDA margin was -6.3% (Q3/2010: -5.4%)
- EBIT from continuing operations was EUR -9.6 (Q3/2010: -8.7) million
- Profit for the period from continuing operations totalled EUR -6.5 (Q3/2010:
-6.4) million
- Cash flow from operations was EUR -5.4 (Q3/2010: -3.4) million and liquid
funds at 30 September 2011 were EUR 74.2 (30 September 2010: 21.1) (30 June
2011: 81.8) million
+----------------------+------+------+------+--------+--------+------+------+
|KEY FIGURES | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|EUR million | Q3/11| Q3/10|Change|Q1-Q3/11|Q1-Q3/10|Change| FY/10|
+----------------------+------+------+------+--------+--------+------+------+
|Revenue | 42.4| 29.0| 46.1%| 121.8| 98.6| 23.5%| 123.3|
+----------------------+------+------+------+--------+--------+------+------+
| | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|EBITDA | -2.7| -1.6| | 2.5| -1.5| | -8.4|
+----------------------+------+------+------+--------+--------+------+------+
|EBITDA margin | -6.3%| -5.4%| | 2.0%| -1.5%| | -6.8%|
+----------------------+------+------+------+--------+--------+------+------+
| | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|EBIT | -9.6| -8.7| | -18.5| -21.4| | -75.6|
+----------------------+------+------+------+--------+--------+------+------+
|EBIT margin |-22.5%|-29.9%| | -15.2%| -21.7%| |-61.3%|
+----------------------+------+------+------+--------+--------+------+------+
| | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Earnings before taxes | -8.4| -9.1| | -18.2| -21.9| | -76.3|
+----------------------+------+------+------+--------+--------+------+------+
|Earnings margin |-19.9%|-31.2%| | -15.0%| -22.3%| |-61.8%|
+----------------------+------+------+------+--------+--------+------+------+
| | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Profit for the period,| -6.5| -6.4| | -13.5| -14.3| | -65.3|
|continuing | | | | | | | |
|operations | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Profit for the period,| -0.2| 3.8| | 46.9| 7.6|517.1%| 14.2|
|discontinued | | | | | | | |
|operations | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Profit for the period | -6.7| -2.6| | 33.4| -6.7| | -51.1|
+----------------------+------+------+------+--------+--------+------+------+
|Earnings per share, | -0.03| -0.02| | 0.14| -0.03| | -0.22|
|basic, EUR | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Return on equity, | -| -| | 18.4%| -3.2%| |-19.6%|
|% p.a. | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Return on capital | -| -| | 13.6%| -3.6%| |-15.2%|
|employed, % p.a. | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Equity ratio, % | -| -| | 54.3%| 53.9%| | 44.3%|
+----------------------+------+------+------+--------+--------+------+------+
|Gearing, % | -| -| | 6.4%| 28.8%| | 46.6%|
+----------------------+------+------+------+--------+--------+------+------+
|Personnel at the end | -| -| | 799| 692| | 722|
|of the period | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
Continuing operations include the Speciality Alloys business segment, the
FerroAlloys business segment and unallocated items that consist of Group
headquarters and other Group companies, which do not have significant business
operations. Discontinued operations include the house building, pallet and
sawmill businesses.
Commenting on the third quarter results, Thomas Hoyer, CEO, said:
"The third quarter was significantly impacted by the downturn in global economic
sentiment and the market for chrome products was an early casualty. Charge
Chrome products were most affected, with prices falling about 15% compared to
the previous quarter, as many buyers did not restock after the seasonal European
summer slowdown.
The Group's diversified product range offered some protection against the
weakening Charge Chrome prices as the demand for our speciality alloys products
remained relatively firm and prices were comparable to the second quarter 2011.
Whilst the South African rand softened significantly during the quarter, it was
not sufficient to offset the impact of falling chrome prices. At an operational
level, TMS, EWW and the Stellite mine delivered a strong production result, in
spite of the annual maintenance shutdowns.
Looking ahead, the outlook for the fourth quarter is bleak, overshadowed by the
uncertainty in the global financial markets and in the Eurozone, and the
possibility of a global recession cannot be discounted. In light of this, the
Group has taken the decision to adjust its production levels accordingly and two
of the four furnaces in the FerroAlloys business have remained switched off
since July's maintenance shutdown.
Our strong cash position enables the Group to weather this current slowdown and
even potentially take advantage of the distressed pricing of mining assets in
the execution of our growth strategy."
2011 OUTLOOK
The Board has updated the Company's outlook for the full year 2011.
As previously stated and as a result of the Company's decision to focus solely
on the mining, smelting and minerals processing business, Ruukki's financial
performance is dependent on the general market conditions of this sector,
particularly in the chrome industry.
There have been significant price fluctuations in the ferroalloys market during
the first three quarters of 2011. Global financial markets have been very
volatile, exacerbated by the recent Eurozone crisis and economic conditions for
the fourth quarter of 2011 are extremely uncertain. Demand for chrome ore and
Charge Chrome is expected to remain weak during the fourth quarter and Ruukki
has adjusted its production volumes accordingly. Demand and prices for
speciality alloys have been more stable, however uncertainty remains in the
fourth quarter too.
Ruukki expects the revenue from continuing operations in 2011 to increase
considerably compared with the full year 2010 and whilst the Group's EBITDA from
continuing operations is expected to improve compared with 2010, it is expected
to be slightly negative for the full year 2011.
Fluctuations of exchange rates between the Euro, the South African Rand, the
Turkish Lira and the US Dollar can significantly impact the Company's financial
performance.
Previously the Company's outlook, published for the second quarter results on
18 August 2011, stated: "There have been significant price fluctuations in the
ferroalloys market during the first half of 2011. Global financial markets
remain turbulent, and economic conditions uncertain. Ruukki is no longer
expecting higher prices for its products in the second half of 2011, and
believes that prices will continue to be under pressure. However, Ruukki does
anticipate its production volumes to be higher for 2011 compared to 2010 and
this is expected to result in increased revenue and improved financial
performance."
Investor Conference Call
Management will host an investor conference call in English on 10 November 2011
at 12.00 Finnish time, 10.00 UK time. Please dial-in at least 10 minutes
beforehand, quoting the reference: 906542.
Finnish number +358 (0)9 2313 9201
UK number +44 (0)20 7162 0077
RUUKKI GROUP PLC
Thomas Hoyer
CEO
For additional information, please contact:
Ruukki Group Plc
Thomas Hoyer, CEO, +358 (0)10 440 7000,thomas.hoyer@ruukkigroup.com
Kalle Lehtonen, General Manager: Finance, +358 (0)400
539 968,kalle.lehtonen@ruukkigroup.com
Markus Kivimäki, General Manager: Corporate Affairs, +358 (0)50
3495 687,markus.kivimaki@ruukkigroup.com
Investec Bank Plc
Stephen Cooper, +44 (0)20 7597 5104,stephen.cooper@investec.co.uk
RBC Capital Markets
Martin Eales, +44 (0)20 7653 4000,martin.eales@rbccm.com
Peter Barrett-Lennard, +44 (0)20 7653 4000,peter.barrett-lennard@rbccm.com
Financial reports and other investor information are available on the Company's
website.
Ruukki Group is a chrome mining and minerals producer focused on delivering
sustainable growth with a speciality alloys business in southern Europe and a
ferro alloys business in southern Africa. The Company is listed on NASDAQ OMX
Helsinki (RUG1V) and the Main Market of the London Stock Exchange (RKKI).
www.ruukkigroup.com
Distribution:
NASDAQ OMX Helsinki
London Stock Exchange
main media
www.ruukkigroup.com
RUUKKI GROUP PLC: Q3 INTERIM REPORT, 1 JULY-30 SEPTEMBER 2011
This Interim Report is prepared in accordance with the IAS 34 standard and is
unaudited. All the figures in this Interim Report related to the house building,
pallet and sawmill businesses are categorised as discontinued operations. All
the corresponding comparable figures of 2010 are presented in brackets, unless
otherwise explicitly stated.
RUUKKI GROUP'S FINANCIAL PERFORMANCE
REVENUE AND PROFITABILITY
+----------------------+------+------+------+--------+--------+------+------+
|EUR million | Q3/11| Q3/10|Change|Q1-Q3/11|Q1-Q3/10|Change| FY/10|
+----------------------+------+------+------+--------+--------+------+------+
|Revenue | 42.4| 29.0| 46.1%| 121.8| 98.6| 23.5%| 123.3|
+----------------------+------+------+------+--------+--------+------+------+
|EBITDA | -2.7| -1.6| | 2.5| -1.5| | -8.4|
+----------------------+------+------+------+--------+--------+------+------+
|EBITDA margin | -6.3%| -5.4%| | 2.0%| -1.5%| | -6.8%|
+----------------------+------+------+------+--------+--------+------+------+
|EBIT | -9.6| -8.7| | -18.5| -21.4| | -75.6|
+----------------------+------+------+------+--------+--------+------+------+
|EBIT margin |-22.5%|-29.9%| | -15.2%| -21.7%| |-61.3%|
+----------------------+------+------+------+--------+--------+------+------+
|Profit for the period,| -0.2| 3.8| | 46.9| 7.6|517.1%| 14.2|
|discontinued | | | | | | | |
|operations | | | | | | | |
+----------------------+------+------+------+--------+--------+------+------+
|Profit for the period | -6.7| -2.6| | 33.4| -6.7| | -51.1|
+----------------------+------+------+------+--------+--------+------+------+
Discontinued operations include the house building, pallet and sawmill
businesses.
Revenue for the third quarter increased by 46.1% to EUR 42.4 (29.0) million. The
increase in revenue, compared to the equivalent period in 2010, was mainly
attributable to the increased production volumes in both the Speciality Alloys
segment and the FerroAlloys segment, following the acquisition of Chromex Mining
in December 2010.
EBITDA for the third quarter was EUR -2.7 (-1.6) million and profit for the
period was EUR -6.7 (-2.6) million. The decrease in EBITDA was mainly due to the
decision not to restart two of the four furnaces in the FerroAlloys segment as a
result of the weak chrome prices, after the yearly maintenance shutdown in July.
Earnings per share was EUR -0.03 (-0.02).
BALANCE SHEET, CASH FLOW AND FINANCING
The Group's liquidity, as at 30 September 2011, when taking into account cash
and cash equivalents as well as short-term deposits, remained strong at EUR
74.2 (21.1) (30 June 2011: 81.8) million. Operating cash flow was EUR -5.4 (-
3.4) million. Ruukki's gearing at the end of the third quarter decreased to
6.4% (28.8%) (30 June 2011: 6.2%). Net interest-bearing debt was EUR 15.8 (80.1)
(30 June 2011: 15.9) million.
As at 30 September, the Group had an unused credit facility of USD 55 million in
place. The facility is available to be drawn down until 31 December 2011.
One of the Group's South African subsidiaries, Mogale Alloys, has drawn a loan
from a South African bank with the principle amount of EUR 8 million. The loan
agreement includes financial covenants some of which were breached during the
review period due to the extraordinarily adverse market conditions. Mogale
Alloys has, however, received a temporary waiver in relation to the breach.
Based on the discussions carried out with the bank, the Company remains
confident that the bank will not request the pay-back of the loan prior to its
maturity date in April, 2015.
Total assets on 30 September 2011 stood at EUR 457.9 (543.9) (30 June
2011: 499.0) million. Equity ratio was 54.3% (53.9%) (30 June 2011: 51.1%).
INVESTMENTS, ACQUISITIONS AND DIVESTMENTS
Capital expenditure in the third quarter totalled EUR 1.2 (4.3) million. The
expenditure related primarily to exploration drilling at Ruukki's mines and
yearly maintenance of its production plants.
On 5 September 2011 Ruukki transferred a total of 2,976,213 ordinary shares as
an earn-out consideration for the speciality alloys business acquired in 2008.
The profit share calculation for the earn-out consideration was confirmed for
the years 2009 and 2010. Ruukki has now fully paid the 2009 earn-out and 50 per
cent of the 2010 earn-out. The subscription price of EUR 3,809,552.64 was
accounted for in whole in the Company's paid-up unrestricted equity reserve.
PERSONNEL
At the end of the third quarter 2011, Ruukki's employees in continuing
operations increased to 799 (692). The number of employees increased in both the
Speciality Alloys and FerroAlloys businesses. The average number of employees
during the third quarter of 2011 was 785 (694).
Number of employees by segment:
+-----------------+---------+---------+------+----------+
| |30.9.2011|30.9.2010|Change|31.12.2010|
+-----------------+---------+---------+------+----------+
|Speciality Alloys| 436| 404| 7.9%| 396|
+-----------------+---------+---------+------+----------+
|FerroAlloys | 353| 273| 29.3%| 316|
+-----------------+---------+---------+------+----------+
|Other operations | 10| 15|-33.3%| 10|
+-----------------+---------+---------+------+----------+
|Continuing | 799| 692| 15.5%| 722|
|operations total | | | | |
+-----------------+---------+---------+------+----------+
SAFETY, HEALTH AND SUSTAINABLE DEVELOPMENT
Work continued during the quarter to introduce standardised health, safety and
environment policies and procedures across the Group's operations, overseen by
the Group's Chief Operating Officer and is on track for completion by the end of
the first quarter 2012. This includes a baseline risk assessment at Mogale and
Stellite, which should be completed by year end. Alongside this, an initial
programme has also begun on focusing on pro-active safety and environment
measurements as part of the Group's aim to achieve "Zero Harm" to its employees,
contractors, neighbouring communities and the environment. This will be rolled
out across all the operations during the next couple of quarters.
On sustainability, Mogale Alloys is seeking ISO 9001 certification /
accreditation in 2012 and the first phase of the ISO 9001 audit was successfully
completed. If successful, this ISO accreditation will complement EWW, which has
already received ISO 9001 and underlines the quality of the Group's chrome
products.
Ruukki aims to conduct its business in a sustainable way and to preserve the
environment by minimising the environmental impact of its operations. Ruukki has
a number of programmes in place to monitor and address its impact on the
environment. The environmental studies being conducted at its South African
processing facilities continue and are expected to be completed by the end of
2011.
SEGMENT PERFORMANCE
SPECIALITY ALLOYS BUSINESS
The Speciality Alloys business consists of TMS, the mining and beneficiation
operation in Turkey, and EWW, the chromite concentrate processing plant in
Germany. TMS supplies EWW with high quality chromite concentrate which produces
speciality products including Specialised Low Carbon and Ultralow Carbon
Ferrochrome. Excess chrome ore is exported from TMS mainly to China. As at 30
September 2011, the business had 436 (404) employees.
Production:
+----------+------+------+------+--------+--------+------+------+
|Tonnes | Q3/11| Q3/10|Change|Q1-Q3/11|Q1-Q3/10|Change| FY/10|
+----------+------+------+------+--------+--------+------+------+
|Mining* |21,958|17,764| 23.6%| 62,588| 38,069| 64.4%|54,917|
+----------+------+------+------+--------+--------+------+------+
|Processing| 5,247| 4,302| 22.0%| 19,337| 13,047| 48.2%|17,994|
+----------+------+------+------+--------+--------+------+------+
* Including both chromite concentrate and lumpy ore production
Production increased 23.3% to 27,205 (22,066) tonnes for the quarter, compared
to the third quarter 2010. In spite of the annual maintenance shutdowns, both
the Turkish and EWW operations ran at full capacity during the quarter.
+-------------+------+------+------+--------+--------+------+------+
|EUR million | Q3/11| Q3/10|Change|Q1-Q3/11|Q1-Q3/10|Change| FY/10|
+-------------+------+------+------+--------+--------+------+------+
|Revenue | 21.9| 18.2| 20.2%| 63.2| 52.3| 20.8%| 69.0|
+-------------+------+------+------+--------+--------+------+------+
|EBITDA | 2.0| 2.8|-28.8%| 10.5| 6.4| 63.6%| 7.8|
+-------------+------+------+------+--------+--------+------+------+
|EBITDA margin| 9.0%| 15.1%| | 16.7%| 12.3%| | 11.3%|
+-------------+------+------+------+--------+--------+------+------+
|EBIT | -2.4| -2.0| | -2.8| -6.8| | -10.0|
+-------------+------+------+------+--------+--------+------+------+
|EBIT margin |-11.2%|-11.1%| | -4.4%| -13.0%| |-14.5%|
+-------------+------+------+------+--------+--------+------+------+
Revenue for the third quarter was EUR 21.9 (18.2) million, representing an
increase of 20.2%. EBITDA for the third quarter was EUR 2.0 (2.8) million. The
decrease in EBITDA, compared to the equivalent period in 2010, was due to weaker
chrome prices and the increase in sales volumes was not enough to compensate for
this. Compared to second quarter in 2011, chrome prices were relatively
comparable.
FERROALLOYS BUSINESS
The FerroAlloys business consists of the Stellite mine, the alloy processing
plant Mogale and the Mecklenburg mine development project in South Africa, as
well as the Zimbabwean mine development project Waylox. The business produces
chrome ore, Charge Chrome, Silico Manganese and Stainless Steel Alloy (chromium-
iron-nickel alloy) and exports chrome ore directly to global markets,
particularly to China. As at 30 September 2011, the business had 353 (273)
employees.
Production:
+----------+------+-----+------+--------+--------+------+------+
|Tonnes | Q3/11|Q3/10|Change|Q1-Q3/11|Q1-Q3/10|Change| FY/10|
+----------+------+-----+------+--------+--------+------+------+
|Mining* |46,006| N/A| | 113,663| N/A| | N/A|
+----------+------+-----+------+--------+--------+------+------+
|Processing|13,189|9,191| 43.5%| 71,471| 52,952| 35.0%|65,040|
+----------+------+-----+------+--------+--------+------+------+
* Including both chromite concentrate and lumpy ore production
Production increased considerably to 59,195 (9,191) tonnes, mainly due to the
acquisition of the Stellite mine in December 2010. Stellite's performance also
improved significantly quarter on quarter, posting a 29.0% increase over the
second quarter.
+-------------+------+------+------+--------+--------+------+------+
|EUR million | Q3/11| Q3/10|Change|Q1-Q3/11|Q1-Q3/10|Change| FY/10|
+-------------+------+------+------+--------+--------+------+------+
|Revenue | 20.5| 10.8| 90.0%| 58.6| 46.0| 27.5%| 54.0|
+-------------+------+------+------+--------+--------+------+------+
|EBITDA | -2.1| -1.4| | -2.0| 4.7| | -1.0|
+-------------+------+------+------+--------+--------+------+------+
|EBITDA margin|-10.3%|-12.8%| | -3.4%| 10.3%| | -1.8%|
+-------------+------+------+------+--------+--------+------+------+
|EBIT | -4.6| -3.7| | -9.6| -1.9| | -50.2|
+-------------+------+------+------+--------+--------+------+------+
|EBIT margin |-22.3%|-34.3%| | -16.4%| -4.1%| |-93.0%|
+-------------+------+------+------+--------+--------+------+------+
Revenue for the third quarter improved considerably to EUR 20.5 (10.8) million,
representing an increase of 90.0% driven by increase in sales volumes. The
increase in revenue was predominantly due to a rise in chrome ore sales from the
Stellite mine, which was acquired in December 2010.
EBITDA for the third quarter was EUR -2.1 (-1.4) million and includes EUR 0.7
(0.9) million of costs related to the feasibility studies for the two new DC
furnaces and a power plant. Despite the increase in chrome ore sales, it was not
sufficient to compensate for the seasonal increase in electricity prices or the
impact of the two furnace shutdowns at Mogale, which were not restarted after
the yearly maintenance in July due to the weak Charge Chrome prices. This
impacted negatively the segment's EBITDA. Charge Chrome prices have decreased by
approximately 15% compared to the previous quarter in 2011.
DISCONTINUED OPERATIONS
Ruukki completed the divestments of its wood processing businesses during the
first and second quarter of 2011. On the Group's income statement these
businesses have been presented as discontinued operations. Profit for the period
from discontinued operations was EUR -0.2 (3.8) million.
UNALLOCATED ITEMS
For the third quarter of 2011, the EBITDA from unallocated items was EUR -2.3 (-
3.0) million including a EUR 0.2 (0.8) million non-cash expense for the share-
based payments.
PLEDGES AND CONTINGENT LIABILITIES, CHANGES DURING THE REVIEW PERIOD
On 30 September 2011, the Group's subsidiaries had given business mortgages as
collateral for loans and other liabilities totalling EUR 0.0 (31 December
2010: 14.0) million. Of the parent company's EUR 4.2 million business mortgages,
EUR 0.0 (1.7) million had been pledged as security with external financial
institutions. Equipment and real estate mortgages amounted to EUR 20.2 (21.5)
million and book value of other pledges EUR 11.6 (11.1) million. Ruukki Group
Plc has given guarantees in connection with certain borrowings of Junnikkala Oy,
the Group's former subsidiary which has been disposed in June 2011. These
guarantees will continue to be in force until 30 June 2018. As part of the terms
of the disposal it has been agreed that Junnikkala will pay a fee of two per
cent per annum to Ruukki Group Plc in consideration for the continuation of
these guarantees. At 30 September 2011 the indebtedness subject to these
guarantees was EUR 1.6 million in aggregate.
SHARE CAPITAL
Ruukki Group Plc's shares are listed on NASDAQ OMX Helsinki (RUG1V) and on the
Main Market of the London Stock Exchange (RKKI).
On 30 September 2011, the registered number of Ruukki Group Plc shares was
248,432,000 (248,207,000) and share capital was EUR 23,642,049.60
(23,642,049.60).
On 30 September 2011, the Company held 4,814,682 (8,740,895) of its own shares
in treasury, which was equivalent to approximately 1.94% (3.52%) of the issued
share capital. The total amount of shares outstanding, excluding the treasury
shares held by the Company on 30 September 2011 was 243,617,318 (239,466,105).
Based on the resolution at the AGM on 11 May 2011, the Board is authorised to
buy back up to a maximum of 15,000,000 of its own shares. This authorisation is
valid until 11 November 2012.
NOTIFICATION OF TRANSACTIONS OF DIRECTORS, PERSONS DISCHARGING MANAGERIAL
RESPONSIBILITY OR CONNECTED PERSONS
Ruukki received on 22 September 2011 a notification that Markku Kankaala, Non-
executive Director, has bought 1,000 ordinary shares in the Company at an
average price of EUR 0.86 per share on 22 September 2011. The trade was made on
the NASDAQ OMX Helsinki Exchange.
Ruukki received on 23 September 2011 a notification that Markku Kankaala, Non-
executive Director, has bought 1,000 ordinary shares in the Company at an
average price of EUR 0.86 per share on 23 September 2011. The trade was made on
the NASDAQ OMX Helsinki Exchange.
Ruukki received on 28 September 2011 a notification that Markku Kankaala, Non-
executive Director, has bought 1,067 ordinary shares in the Company at an
average price of EUR 0.91 per share on 26 September 2011. The trade was made on
the NASDAQ OMX Helsinki Exchange.
Accordingly Markku Kankaala now holds voting rights attached to 7,480,600
shares, representing 3.07% of the issued share capital of the Company excluding
treasury shares.
MOST SIGNIFICANT RISKS AND UNCERTAINTIES, CHANGES DURING AND AFTER THE PERIOD
UNDER REVIEW
The changes in the key risks and uncertainties are set out below. Further
details of the risks and uncertainties have been published in the Group's 2010
Annual Report.
Following the Company's transformation into a focused mining and minerals
processing company, the Group has become more exposed to foreign exchange rate
risks, commodity price risks and the risks of fluctuating demand in the mining
and minerals sector.
Changes in foreign exchange rates, if adverse, could have a substantial negative
impact on the Group's profitability, in particular changes in US Dollar/South
African Rand. Changes in the South African Rand exchange rate could also have an
effect on the Euro value of the deferred purchase consideration of Mogale
Alloys. In order to better manage its foreign exchange US Dollar/South African
Rand exposure, the Group has entered into a limited forward contract arrangement
for the next twelve months.
Global financial markets have been very volatile, exacerbated by the recent
Eurozone crisis and there is uncertainty as to how commodity prices will
respond during the last quarter of 2011 and this could impact the Company's
revenue and financial performance.
The Group is considering a number of options to grow the Company's resources,
mining and processing operations, including organic growth as well as mergers
and acquisitions. These growth options could expose the Group to funding,
implementation and integration related risks.
2011 OUTLOOK
The Board has updated the Company's outlook for the full year 2011.
As previously stated and as a result of the Company's decision to focus solely
on the mining, smelting and minerals processing business, Ruukki's financial
performance is dependent on the general market conditions of this sector,
particularly in the chrome industry.
There have been significant price fluctuations in the ferroalloys market during
the first three quarters of 2011. Global financial markets have been very
volatile, exacerbated by the recent Eurozone crisis and economic conditions for
the fourth quarter 2011 are extremely uncertain. Demand for chrome ore and
Charge Chrome is expected to remain weak during the fourth quarter and Ruukki
has adjusted its production volumes accordingly. Demand and prices for
speciality alloys have been more stable, however uncertainty remains in the
fourth quarter too.
Ruukki expects the revenue from continuing operations in 2011 to increase
considerably compared with the full year 2010 and whilst the Group's EBITDA from
continuing operations is expected to improve compared with 2010, it is expected
to be slightly negative for the full year 2011.
Fluctuations of exchange rates between the Euro, the South African Rand, the
Turkish Lira and the US Dollar can significantly impact the Company's financial
performance.
Previously the Company's outlook, published for the second quarter results on
18 August 2011, stated: "There have been significant price fluctuations in the
ferroalloys market during the first half of 2011. Global financial markets
remain turbulent, and economic conditions uncertain. Ruukki is no longer
expecting higher prices for its products in the second half of 2011, and
believes that prices will continue to be under pressure. However, Ruukki does
anticipate its production volumes to be higher for 2011 compared to 2010 and
this is expected to result in increased revenue and improved financial
performance."
Helsinki, 9 November 2011
RUUKKI GROUP PLC
BOARD OF DIRECTORS
FINANCIAL REPORTING IN 2012
|Closed period |Reporting date
| |
Full Year Results 2011|1.1.-24.2.2012 |24 February 2012
| |
Q1 Interim Report 2012|10.4.-10.5.2012|10 May 2012
| |
Q2 Interim Report 2012|17.7.-16.8.2012|16 August 2012
| |
Q3 Interim Report 2012|8.10.-7.11.2012|7 November 2012
----------------------+---------------+----------------
FINANCIAL TABLES
FINANCIAL DEVELOPMENT AND ASSETS AND LIABILITIES BY SEGMENT
+--------------+----------+-------+-----------+------------+----------+
|1.1.-30.9.2011|Speciality| Ferro|Unallocated|Eliminations|Continuing|
|9 months | Alloys| Alloys| items| |operations|
|EUR '000 | | | | | total|
+--------------+----------+-------+-----------+------------+----------+
|Revenue | 63,160| 58,608| 522| -522| 121,768|
+--------------+----------+-------+-----------+------------+----------+
|EBITDA | 10,549| -2,003| -6,070| 1| 2,476|
+--------------+----------+-------+-----------+------------+----------+
|EBIT | -2,775| -9,621| -6,111| 1| -18,507|
+--------------+----------+-------+-----------+------------+----------+
|Segment's | 188,393|206,232| 71,795| -15,755| 450,665|
|assets | | | | | |
+--------------+----------+-------+-----------+------------+----------+
|Segment's | 61,069|114,036| 47,719| -13,439| 209,385|
|liabilities | | | | | |
+--------------+----------+-------+-----------+------------+----------+
+--------------+----------+-------+-----------+------------+----------+
|1.1.-30.9.2010|Speciality| Ferro|Unallocated|Eliminations|Continuing|
|9 months | Alloys| Alloys| items| |operations|
|EUR '000 | | | | | total|
+--------------+----------+-------+-----------+------------+----------+
|Revenue | 52,289| 45,954| 455| -130| 98,568|
+--------------+----------+-------+-----------+------------+----------+
|EBITDA | 6,446| 4,720| -12,861| 221| -1,474|
+--------------+----------+-------+-----------+------------+----------+
|EBIT | -6,804| -1,882| -12,910| 221| -21,376|
+--------------+----------+-------+-----------+------------+----------+
|Segment's | 179,175|237,165| 12,050| -9,848| 418,542|
|assets | | | | | |
+--------------+----------+-------+-----------+------------+----------+
|Segment's | 73,849| 96,269| 51,152| -18,533| 202,737|
|liabilities | | | | | |
+--------------+----------+-------+-----------+------------+----------+
+---------------+----------+-------+-----------+------------+----------+
|1.1.-31.12.2010|Speciality| Ferro|Unallocated|Eliminations|Continuing|
|12 months | Alloys| Alloys| items| |operations|
|EUR '000 | | | | | total|
+---------------+----------+-------+-----------+------------+----------+
|Revenue | 69,017| 54,006| 967| -643| 123,347|
+---------------+----------+-------+-----------+------------+----------+
|EBITDA | 7,803| -972| -15,369| 99| -8,439|
+---------------+----------+-------+-----------+------------+----------+
|EBIT | -10,009|-50,216| -15,433| 99| -75,559|
+---------------+----------+-------+-----------+------------+----------+
|Segment's | 182,347|248,011| 15,919| -10,616| 435,661|
|assets | | | | | |
+---------------+----------+-------+-----------+------------+----------+
|Segment's | 77,265|136,702| 51,918| -6,840| 259,045|
|liabilities | | | | | |
+---------------+----------+-------+-----------+------------+----------+
CONSOLIDATED INCOME STATEMENT, SUMMARY
+-----------------------------------+--------+--------+-------+-------+--------+
|EUR '000 |Q1-Q3/11|Q1-Q3/10| Q3/11| Q3/10| FY/10|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Continuing operations | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Revenue | 121,768| 98,568| 42,432| 29,047| 123,347|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Other operating income | 902| 716| 267| 535| 1,248|
+-----------------------------------+--------+--------+-------+-------+--------+
|Operating expenses |-120,461|-100,974|-45,419|-31,327|-133,424|
+-----------------------------------+--------+--------+-------+-------+--------+
|Depreciation and amortisation | -20,982| -19,902| -6,891| -7,116| -27,023|
+-----------------------------------+--------+--------+-------+-------+--------+
|Impairment | 0| 0| 0| 0| -40,097|
+-----------------------------------+--------+--------+-------+-------+--------+
|Items related to associates | 267| 216| 61| 189| 390|
|(core) | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Operating profit | -18,507| -21,376| -9,550| -8,673| -75,559|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Financial income and expense | 106| -467| 1,120| -266| -595|
+-----------------------------------+--------+--------+-------+-------+--------+
|Items related to associates | 196| -103| 0| -134| -99|
|(non-core) | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Profit before tax | -18,205| -21,946| -8,430| -9,073| -76,253|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Income tax | 4,725| 7,674| 1,930| 2,635| 10,942|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Profit for the period from | -13,480| -14,272| -6,499| -6,438| -65,311|
|continuing operations | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Discontinued operations | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Profit for the period from | 46,917| 7,603| -207| 3,831| 14,186|
|discontinued operations | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Profit for the period | 33,437| -6,669| -6,707| -2,607| -51,125|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Profit attributable to: | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Owners of the parent | 33,741| -8,125| -6,162| -3,972| -52,611|
+-----------------------------------+--------+--------+-------+-------+--------+
|Non-controlling interests | -304| 1,456| -545| 1,365| 1,486|
+-----------------------------------+--------+--------+-------+-------+--------+
|Total | 33,437| -6,669| -6,707| -2,607| -51,125|
+-----------------------------------+--------+--------+-------+-------+--------+
| | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|Earnings per share (counted from profit attributable to owners of the parent):|
+-----------------------------------+--------+--------+-------+-------+--------+
|basic (EUR), Group total | 0.14| -0.03| -0.03| -0.02| -0.22|
+-----------------------------------+--------+--------+-------+-------+--------+
|diluted (EUR), Group total | 0.12| -0.03| -0.03| -0.02| -0.22|
+-----------------------------------+--------+--------+-------+-------+--------+
|basic (EUR), continuing | -0.05| -0.06| -0.02| -0.03| -0.27|
|operations | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
|diluted (EUR), continuing | -0.05| -0.06| -0.02| -0.03| -0.27|
|operations | | | | | |
+-----------------------------------+--------+--------+-------+-------+--------+
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
+------------------------------+--------+--------+-------+------+-------+
|EUR '000 |Q1-Q3/11|Q1-Q3/10| Q3/11| Q3/10| FY/10|
+------------------------------+--------+--------+-------+------+-------+
| | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Profit for the period | 33,437| -6,669| -6,707|-2,607|-51,125|
+------------------------------+--------+--------+-------+------+-------+
| | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Other comprehensive income | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Exchange differences on | -15,495| 12,826| -4,976|-2,350| 19,412|
|translating foreign operations| | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Income tax relating to other | 6,553| -5,451| 1,117| 1,048| -9,815|
|comprehensive income | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Other comprehensive | -8,941| 7,375| -3,859|-1,302| 9,597|
|income, net of tax | | | | | |
+------------------------------+--------+--------+-------+------+-------+
| | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Total comprehensive income | 24,496| 706|-10,566|-3,909|-41,528|
|for the period | | | | | |
+------------------------------+--------+--------+-------+------+-------+
| | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Total comprehensive income | | | | | |
|attributable to: | | | | | |
+------------------------------+--------+--------+-------+------+-------+
|Owners of the parent | 27,487| -1,846| -8,796|-5,091|-44,854|
+------------------------------+--------+--------+-------+------+-------+
|Non-controlling interests | -2,991| 2,552| -1,770| 1,181| 3,327|
+------------------------------+--------+--------+-------+------+-------+
CONSOLIDATED STATEMENT OF FINANCIAL POSITION, SUMMARY
+-------------------------------------------+---------+---------+----------+
|EUR '000 |30.9.2011|30.9.2010|31.12.2010|
+-------------------------------------------+---------+---------+----------+
|ASSETS | | | |
+-------------------------------------------+---------+---------+----------+
|Non-current assets | | | |
+-------------------------------------------+---------+---------+----------+
|Investments and intangible assets | | | |
+-------------------------------------------+---------+---------+----------+
|Goodwill | 113,829| 183,009| 129,120|
+-------------------------------------------+---------+---------+----------+
|Investments in associates | 63| 267| 284|
+-------------------------------------------+---------+---------+----------+
|Other intangible assets | 68,731| 95,739| 94,154|
+-------------------------------------------+---------+---------+----------+
|Investments and intangible assets total | 182,623| 279,015| 223,559|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Property, plant and equipment | 70,318| 79,247| 87,468|
+-------------------------------------------+---------+---------+----------+
|Other non-current assets | 44,202| 27,668| 44,022|
+-------------------------------------------+---------+---------+----------+
|Non-current assets total | 297,142| 385,930| 355,050|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Current assets | | | |
+-------------------------------------------+---------+---------+----------+
|Inventories | 44,605| 73,115| 45,160|
+-------------------------------------------+---------+---------+----------+
|Receivables | 34,713| 56,265| 26,853|
+-------------------------------------------+---------+---------+----------+
|Other investments | 0| 256| 0|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Cash and cash equivalents | 34,205| 21,079| 8,598|
+-------------------------------------------+---------+---------+----------+
|Bank deposits | 40,000| 0| 0|
+-------------------------------------------+---------+---------+----------+
|Liquid funds total | 74,205| 21,079| 8,598|
+-------------------------------------------+---------+---------+----------+
|Current assets total | 153,522| 150,715| 80,611|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Assets held for sale | 7,239| 7,239| 110,809|
+-------------------------------------------+---------+---------+----------+
|Cash and cash equivalents held for sale | 0| 0| 10,561|
+-------------------------------------------+---------+---------+----------+
|Assets held for sale total | 7,239| 7,239| 121,369|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Total assets | 457,904| 543,884| 557,030|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|EQUITY AND LIABILITIES | | | |
+-------------------------------------------+---------+---------+----------+
|Equity attributable to owners of the parent| | | |
+-------------------------------------------+---------+---------+----------+
|Share capital | 23,642| 23,642| 23,642|
+-------------------------------------------+---------+---------+----------+
|Share premium reserve | 25,740| 25,740| 25,740|
+-------------------------------------------+---------+---------+----------+
|Revaluation reserve | 0| 2,193| 2,193|
+-------------------------------------------+---------+---------+----------+
|Paid-up unrestricted equity reserve | 245,128| 250,849| 250,849|
+-------------------------------------------+---------+---------+----------+
|Translation reserves | 7,668| 12,444| 13,921|
+-------------------------------------------+---------+---------+----------+
|Retained earnings | -68,173| -56,646| -104,772|
+-------------------------------------------+---------+---------+----------+
|Equity attributable to owners of the parent| 234,005| 258,222| 211,574|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Non-controlling interests | 14,514| 20,138| 24,781|
+-------------------------------------------+---------+---------+----------+
|Total equity | 248,519| 278,361| 236,355|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Liabilities | | | |
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Non-current liabilities | 171,931| 185,167| 216,556|
+-------------------------------------------+---------+---------+----------+
|Current liabilities | | | |
+-------------------------------------------+---------+---------+----------+
|Advances received | 350| 27,449| 0|
+-------------------------------------------+---------+---------+----------+
|Other current liabilities | 37,104| 52,907| 42,489|
+-------------------------------------------+---------+---------+----------+
|Current liabilities total | 37,454| 80,356| 42,489|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Liabilities classified as held for sale | 0| 0| 61,630|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Total liabilities | 209,385| 265,523| 320,675|
+-------------------------------------------+---------+---------+----------+
| | | | |
+-------------------------------------------+---------+---------+----------+
|Total equity and liabilities | 457,904| 543,884| 557,030|
+-------------------------------------------+---------+---------+----------+
SUMMARY OF CASH, INTEREST-BEARING RECEIVABLES AND INTEREST-BEARING LIABILITIES
+----------------------------+---------+---------+----------+
|EUR '000 |30.9.2011|30.9.2010|31.12.2010|
+----------------------------+---------+---------+----------+
| | | | |
+----------------------------+---------+---------+----------+
|Liquid funds | 74,205| 21,079| 8,598|
+----------------------------+---------+---------+----------+
| | | | |
+----------------------------+---------+---------+----------+
|Interest-bearing receivables| | | |
+----------------------------+---------+---------+----------+
|Current | 420| 13,017| 2,200|
+----------------------------+---------+---------+----------+
|Non-current | 31,778| 12,945| 28,865|
+----------------------------+---------+---------+----------+
|Interest-bearing receivables| 32,198| 25,962| 31,065|
+----------------------------+---------+---------+----------+
| | | | |
+----------------------------+---------+---------+----------+
|Interest-bearing liabilities| | | |
+----------------------------+---------+---------+----------+
|Current | 7,628| 12,376| 4,577|
+----------------------------+---------+---------+----------+
|Non-current | 82,368| 88,842| 102,244|
+----------------------------+---------+---------+----------+
|Interest-bearing liabilities| 89,996| 101,218| 106,821|
+----------------------------+---------+---------+----------+
| | | | |
+----------------------------+---------+---------+----------+
|NET TOTAL | 16,407| -54,177| -67,157|
+----------------------------+---------+---------+----------+
Excluding interest-bearing assets and liabilities classified as held for sale
SUMMARY OF GROUP'S PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
+--------------------------------------+----------------+-----------+
|EUR '000 | Property, plant| Intangible|
| | and equipment| assets|
+--------------------------------------+----------------+-----------+
| Acquisition cost 1.1.2011 | 132,715| 354,221|
+--------------------------------------+----------------+-----------+
| Additions | 3,015| 379|
+--------------------------------------+----------------+-----------+
| Disposals | -367| -1,424*|
+--------------------------------------+----------------+-----------+
| Transfer to assets held for sale | -353| 1|
+--------------------------------------+----------------+-----------+
| Reclass between items | 5,690| -1,050|
+--------------------------------------+----------------+-----------+
| Effect of movements in exchange rates| -18,188| -38,324|
+--------------------------------------+----------------+-----------+
| Acquisition cost 30.9.2011 | 122,512| 313,803|
+--------------------------------------+----------------+-----------+
| | | |
+--------------------------------------+----------------+-----------+
| Acquisition cost 1.1.2010 | 127,541| 337,547|
+--------------------------------------+----------------+-----------+
| Additions | 51,968| 8,231*|
+--------------------------------------+----------------+-----------+
| Disposals | -4,044| 0|
+--------------------------------------+----------------+-----------+
| Transfer to assets held for sale | -49,614| -26,519|
+--------------------------------------+----------------+-----------+
| Reclass between items | 298| -240|
+--------------------------------------+----------------+-----------+
| Effect of movements in exchange rates| 6,566| 35,201|
+--------------------------------------+----------------+-----------+
| Acquisition cost 31.12.2010 | 132,715| 354,221|
+--------------------------------------+----------------+-----------+
* Including changes in earn-out liabilities
CONSOLIDATED STATEMENT OF CASH FLOWS, SUMMARY
+---------------------------------------------+--------+--------+-------+
|EUR '000 |Q1-Q3/11|Q1-Q3/10| FY/10|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Profit for the period | 33,437| -6,669|-51,125|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Adjustments to profit for the period | -25,231| 12,265| 57,700|
+---------------------------------------------+--------+--------+-------+
|Changes in working capital | -17,998| 3,118| 4,604|
+---------------------------------------------+--------+--------+-------+
|Discontinued operations | 2,340| 240| -616|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Net cash from operating activities | -7,452| 8,954| 10,563|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Acquisition of subsidiaries and associates, | -500| -1,232|-21,855|
|net of cash acquired | | | |
+---------------------------------------------+--------+--------+-------+
|Acquisition of joint ventures, net of cash | -1,592| -9,000|-20,372|
|acquired | | | |
+---------------------------------------------+--------+--------+-------+
|Payments of earn-out liabilities | 0| -65| -65|
+---------------------------------------------+--------+--------+-------+
|Disposal of subsidiaries and associates, | 83,276| 1,636| 1,640|
|net of cash sold | | | |
+---------------------------------------------+--------+--------+-------+
|Capital expenditure and other investing | -3,134| -9,200|-14,229|
|activities | | | |
+---------------------------------------------+--------+--------+-------+
|Proceeds from repayments of loans and | -2,889| 534|-11,222|
|loans given | | | |
+---------------------------------------------+--------+--------+-------+
|Discontinued operations | -77| 9,200| 10,885|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Net cash used in investing activities | 75,085| -8,127|-55,218|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Acquisition of own shares | 0| -10| -10|
+---------------------------------------------+--------+--------+-------+
|Capital redemption | -9,617| -9,570| -9,570|
+---------------------------------------------+--------+--------+-------+
|Dividends paid to non-controlling interests | -86| -75| -129|
+---------------------------------------------+--------+--------+-------+
|Deposits and interest received on investments| 0| 2,503| 2,509|
+---------------------------------------------+--------+--------+-------+
|Proceeds from borrowings | 11,139| 2,989| 23,312|
+---------------------------------------------+--------+--------+-------+
|Repayment of borrowings, and other | -13,215| -21,941| -2,037|
|financing activities | | | |
+---------------------------------------------+--------+--------+-------+
|Discontinued operations | -339| -9,894| -6,585|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Net cash used in financing activities | -12,118| -35,998| 7,491|
+---------------------------------------------+--------+--------+-------+
| | | | |
+---------------------------------------------+--------+--------+-------+
|Net increase in cash and cash equivalents | 55,515| -35,170|-37,165|
+---------------------------------------------+--------+--------+-------+
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
A = Share capital
B = Share premium reserve
C = Fair value and revaluation reserves
D = Paid-up unrestricted equity reserve
E = Translation reserve
F = Retained earnings
G = Equity attributable to owners of the parent, total
H = Non-controlling interests
I = Total equity
+----------+----------------------------------------------------+------+-------+
|EUR '000 | A B C D E F G | H | I |
+----------+----------------------------------------------------+------+-------+
|Equity at |23,642 25,740 2,193 260,357 6,165 -49,953 268,144|17,878|286,022|
|31.12.2009| | | |
+----------+----------------------------------------------------+------+-------+
|Dividend | 0| -293| -293|
|distri- | | | |
|bution | | | |
| | | | |
|Total | 6,279 -8,125 -1,846| 2,552| 706|
|compre- | | | |
|hensive | | | |
|income | | | |
|1-9/2010 | | | |
| | | | |
|Share- | 1,395 1,395| | 1,395|
|based | | | |
|payments | | | |
| | | | |
|Share sub-| 72 72| | 72|
|scriptions| | | |
|based on | | | |
|option | | | |
|rights | | | |
| | | | |
|Acquisi- | -10 -10| | -10|
|tion of | | | |
|own | | | |
|shares | | | |
| | | | |
|Capital | -9,570 -9,570| | -9,570|
|redemption| | | |
| | | | |
|Acquisi- | 17 17| 1| 18|
|tions and | | | |
|disposals | | | |
|of | | | |
|subsidia- | | | |
|ries | | | |
| | | | |
|Other | 20 20| | 20|
|changes | | | |
+----------+----------------------------------------------------+------+-------+
|Equity at |23,642 25,740 2,193 250,849 12,444 -56,646 258,222|20,138|278,361|
|30.9.2010 | | | |
+----------+----------------------------------------------------+------+-------+
|Dividend | 0| -64| -64|
|distri- | | | |
|bution | | | |
| | | | |
|Total | 1,477 -44,486 -43,009| 775|-42,234|
|compre- | | | |
|hensive | | | |
|income | | | |
|10-12/2010| | | |
| | | | |
|Share- | 293 293| | 293|
|based | | | |
|payments | | | |
| | | | |
|Acquisi- | -3,932 -3,932| 3,932| -1|
|tions and | | | |
|disposals | | | |
|of | | | |
|subsidia- | | | |
|ries | | | |
+----------+----------------------------------------------------+------+-------+
|Equity at |23,642 25,740 2,193 250,849 13,921 -104,772 211,574|24,781|236,355|
|31.12.2010| | | |
+----------+----------------------------------------------------+------+-------+
|Dividend | 0| -627| -627|
|distri- | | | |
|bution | | | |
| | | | |
|Total | -6,254 33,741 27,487|-2,991| 24,496|
|compre- | | | |
|hensive | | | |
|income | | | |
|1-9/2011 | | | |
| | | | |
|Share- | 666 666| | 666|
|based | | | |
|payments | | | |
| | | | |
|Share sub-| 3,895 3,895| | 3,895|
|scriptions| | | |
|based on | | | |
|option | | | |
|rights | | | |
| | | | |
|Capital | -9,617 -9,617| | -9,617|
|redemption| | | |
| | | | |
|Acquisi- | -2,193 2,193 0|-6,649| -6,649|
|tions and | | | |
|disposals | | | |
|of | | | |
|subsidia- | | | |
|ries | | | |
+----------+----------------------------------------------------+------+-------+
|Equity at |23,642 25,740 0 245,128 7,668 -68,173 234,005|14,514|248,519|
|30.9.2011 | | | |
+----------+----------------------------------------------------+------+-------+
RELATED PARTY TRANSACTIONS DURING THE REVIEW PERIOD
During the nine month period ended on 30 September 2011 the Group had sold goods
and rendered services to related parties and joint ventures worth EUR 4.2 (4.9)
million. The Group had also made raw material purchases from a joint venture
amounting to EUR 0.7 (0.0) million and accrued interest on loans from a related
party amounting to EUR 0.4 (0.0) million. Interest income from a joint venture
company totalled EUR 0.4 (0.0) million during the first three quarters of 2011.
On 30 September the Group had loan and other receivables from joint venture
companies totalling EUR 16.6 (0.0) million and loan and interest receivables
from a related party amounting to EUR 10.1 (10.1) million. The Group's loans
from a related party amounted to EUR 6.4 (0.0) million and the Group's joint
venture's loans from a related party to EUR 11.0 (0.0) million. The Group also
had an acquisition related earn-out liability to a related party amounting to
EUR 29.8 (29.2) million.
The Group has an unused credit facility from its major shareholder Kermas Ltd
amounting to USD 55 million. The facility is available to be drawn down until
31 December 2011.
EXCHANGE RATES
The balance sheet date rate is based on exchange rate published by the European
Central Bank for the closing date. The average exchange rate is calculated as an
average of daily rates from the European Central Bank during the year.
The key exchange rates applied in the accounts:
Average rates
+---+--------+--------+------+
| |Q1-Q3/11|Q1-Q3/10| FY/10|
+---+--------+--------+------+
|TRY| 2.2920| 1.9989|1.9965|
+---+--------+--------+------+
|USD| 1.4065| 1.3145|1.3257|
+---+--------+--------+------+
|ZAR| 9.8238| 9.8084|9.6984|
+---+--------+--------+------+
Balance sheet rates
+---+---------+---------+----------+
| |30.9.2011|30.9.2010|31.12.2010|
+---+---------+---------+----------+
|TRY| 2.5100| 1.9806| 2.0694|
+---+---------+---------+----------+
|USD| 1.3503| 1.3648| 1.3362|
+---+---------+---------+----------+
|ZAR| 10.9085| 9.5438| 8.8625|
+---+---------+---------+----------+
FORMULAS FOR FINANCIAL INDICATORS
Financial ratios and indicators have been calculated with the same principles as
applied in the 2010 financial statements. These principles are presented below.
Return on equity, % = Profit for the period / Total equity (average for the
period) * 100
Return on capital employed, % = (Profit before taxes + financing expenses) /
(Total assets - interest-free liabilities) average * 100
Equity ratio, % = Total equity / (Total assets - prepayments received) * 100
Gearing, % = (Interest-bearing debt - liquid funds) / Total equity * 100
Net interest-bearing debt = Interest-bearing debt - liquid funds
Earnings per share, basic, EUR = Profit attributable to owners of the parent
company / Average number of shares during the period
Earnings per share, diluted, EUR = Profit attributable to owners of the parent
company / Average number of shares during the period, diluted
Operating profit (EBIT) = Operating profit is the net of revenue plus other
operating income, plus gain/loss on finished goods inventory change, minus
employee benefits expense, minus depreciation, amortisation and impairment and
minus other operating expense. Foreign exchange gains or losses are included in
operating profit when generated from ordinary activities. Exchange gains or
losses related to financing activities are recognised as financial income or
expense.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) =
Operating profit + depreciation + amortisation + impairment losses
ACCOUNTING POLICIES
This Interim Report is prepared in accordance with the IAS 34 standard. Ruukki
Group Plc applies the same accounting and IFRS principles as in the 2010
financial statements with the exception that from the beginning of 2011 the
Company has applied a new reporting business segment structure. The new
reporting business segments are the FerroAlloys and the Speciality Alloys
segments. In 2010 the Company had two reporting segments: Wood Processing
Business and Minerals Business. The Company has published the comparative
financial information for the new segments on 28 April 2011.
The preparation of the Interim Report in accordance with IFRS requires
management to make estimates and assumptions that affect the valuation of the
reported assets and liabilities and other information, such as contingent
liabilities and the recognition of income and expenses in the income statement.
Although the estimates are based on the management's best knowledge of current
events and actions, actual results may differ from the estimates.
The figures in the tables have been rounded off, which must be considered when
calculating totals. Average exchange rates for the period have been used for
income statement conversions, and period-end exchange rates for balance sheet.
The Interim Report data are unaudited.
Share-related key figures
+-------------------------+-----------+-----+-----+--------+--------+------+
| | |Q3/11|Q3/10|Q1-Q3/11|Q1-Q3/10| FY/10|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share price | | | | | | |
|development in London | | | | | | |
|Stock Exchange* | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Average share price** |EUR | 1.24| 1.85| 1.65| N/A| 1.64|
+-------------------------+-----------+-----+-----+--------+--------+------+
| |GBP | 1.09| 1.54| 1.44| N/A| 1.39|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Lowest share price** |EUR | 0.96| 1.76| 0.96| N/A| 1.60|
+-------------------------+-----------+-----+-----+--------+--------+------+
| |GBP | 0.84| 1.47| 0.84| N/A| 1.36|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Highest share price** |EUR | 1.52| 2.14| 1.84| N/A| 2.10|
+-------------------------+-----------+-----+-----+--------+--------+------+
| |GBP | 1.33| 1.78| 1.60| N/A| 1.78|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share price at the end of|EUR | 0.98| 1.89| 0.98| N/A| 1.68|
|the period*** | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
| |GBP | 0.85| 1.63| 0.85| N/A| 1.45|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Market capitalisation at |EUR million|243.7|469.0| 243.7| N/A| 416.7|
|the end of the period*** | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
| |GBP million|211.2|403.3| 211.2| N/A| 358.7|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share trading | | | | | | |
|development | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |thousand | 24| 73| 117| N/A| 712|
| |shares | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |EUR | 30| 135| 193| N/A| 1,168|
| |thousand | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |GBP | 26| 112| 168| N/A| 990|
| |thousand | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |% | 0.0%| 0.0%| 0.0%| N/A| 0.3%|
+-------------------------+-----------+-----+-----+--------+--------+------+
| | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share price | | | | | | |
|development in | | | | | | |
|NASDAQ OMX Helsinki | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Average share price |EUR | 1.04| 1.77| 1.45| 1.57| 1.59|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Lowest share price |EUR | 0.81| 1.45| 0.81| 1.00| 1.00|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Highest share price |EUR | 1.61| 1.96| 2.03| 2.30| 2.30|
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share price at the end of|EUR | 0.98| 1.89| 0.98| 1.89| 1.70|
|the period | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Market capitalisation at |EUR million|243.5|469.1| 243.5| 469.1| 422.0|
|the end of the period | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share trading | | | | | | |
|development | | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |thousand |3,039|2,477| 8,746| 18,907|21,042|
| |shares | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |EUR |3,150|4,373| 12,684| 29,732|33,414|
| |thousand | | | | | |
+-------------------------+-----------+-----+-----+--------+--------+------+
|Share turnover |% | 1.2%| 1.0%| 3.5%| 7.6%| 8.5%|
+-------------------------+-----------+-----+-----+--------+--------+------+
* Ruukki's shares have been listed on the London Stock Exchange as of 26 July
2010, therefore share information on the LSE is available only from that day
onwards.
** Share prices have been calculated on the average EUR/GBP exchange rate
published by Bank of Finland.
*** Share price and market capitalisation at the end of the period have been
calculated on the EUR/GBP exchange rate published by Bank of Finland at the end
of the period.
Formulas for share-related key indicators
Average share price = Total value of shares traded in currency / Number of
shares traded during the period
Market capitalisation, million = Number of shares * Share price at the end of
the period
FORWARD LOOKING STATEMENTS
This report contains forward-looking statements. Often, but not always, forward-
looking statements can be identified by the use of forward-looking terminology,
including the terms "believes", "expects", "intends", "may", "will" or "should"
or, in each case, their negative or other variations or comparable terminology.
By their nature, forward-looking statements involve uncertainty because they
depend on future circumstances, and relate to events, not all of which are
within the Company's control or can be predicted by the Company.
Although the Company believes that the expectations reflected in such forward-
looking statements are reasonable, no assurance can be given that such
expectations will prove to have been correct. Actual results could differ
materially from those set out in the forward-looking statements. Save as
required by law (including the Finnish Securities Markets Acts (495/1989), as
amended, or by the Listing Rules or the Disclosure and Transparency Rules of the
UK Financial Services Authority), the Company undertakes no obligation to update
any forward-looking statements in this report that may occur due to any changes
in the Directors' expectations or to reflect events or circumstances after the
date of this report.
[HUG#1562561]
