ASPO Plc STOCK EXCHANGE BULLETIN April 29, 2008, at 8.30
a.m.
ASPO INTERIM REPORT JANUARY 1 - MARCH 31, 2008
Net sales grew to EUR 65.2 million, the operating profit was EUR 2.5
million
- Aspo Group's net sales in January-March were EUR 65.2 million (EUR
63.1 million)
- The operating profit totaled EUR 2.5 million (EUR 3.0 million)
- The profit before taxes was EUR 1.7 million (EUR 2.4 million)
- The earnings per share totaled EUR 0.05 (EUR 0.07)
- The organic growth of Group's net sales is expected to continue and
a good operational performance is expected for fiscal 2008.
KEY FIGURES
1-3/2008 1-3/2007 1-12/2007
Net sales, MEUR 65.2 63.1 266.6
Operating profit, MEUR 2.5 3.0 23.8
Share of net sales, % 3.9 4.8 8.9
Profit before tax, MEUR 1.7 2.4 21.4
Share of net sales, % 2.6 3.7 8.0
Earnings per share, EUR 0.05 0.07 0.59
EPS adjusted for dilution, EUR 0.05 0.07 0.56
Comparable earnings per share, EUR 0.30
Equity per share, EUR 2.44 1.94 2.43
Equity ratio, % 45.5 35.4 45.1
Gearing, % 31.3 54.7 32.4
Personnel at the end of period 675 683 699
Gustav Nyberg, CEO of Aspo:
"No substantial changes took place in the market situation for the
Aspo Group during the first quarter of 2008. For both Shipping and
Systems, the market continued to be strong, but insecurity was still
characteristic of the market for Chemicals.
Comparable net sales continued to grow in all divisions, but earnings
development varied. The Group's operating profit was slightly weaker
year on year. The growth of net sales continued at a strong level in
the East and at a fairly modest level in Finland and the Western
markets. The Group's cost management was successful.
The Kauko-Telko acquisition, prominent for Aspo, was published in
February. Kauko-Telko has strong business areas that are very well
suited to Aspo. Industrial raw materials will place Chemicals in a
new size category. Raw materials, equipment and services for food
industry will become Aspo's fourth business area, which will increase
our stability and further reinforce our position in the East.
Approval by the competition authorities is required for the
acquisition to be carried out. It is expected that the acquisition
will be completed during the second quarter of this year.
The new Aspo will be an even more balanced Group and more diversified
in terms of risks. It also holds more potential for developing the
Group structure further."
OPERATIONAL PERFORMANCE
The early part of the year saw speculations as to the United States
market descending into recession and the potential ramifications
concerning raw material prices world-wide. The impact of the
situation in the United States was slight or nonexistent with regard
to Aspo Group's operations in Russia, but added to the insecurity of
our customers in other markets.
The continued trend of record highs in oil prices also kept the
prices of petrochemicals fairly steady. The prices of commodities
paid in euro remained in check due to the weakened US dollar.
The demand in dry bulk cargo continued to be good, and the price
level of sea freights continued higher than average. The mild winter
made traffic easier.
The service station market was active and the mild weather
facilitated installation operations.
Aspo Chemicals
The Aspo Chemicals Division consists of Aspokem Ltd and its
subsidiaries. They distribute, store and market chemicals and plastic
raw materials in Finland, Sweden, Denmark, Estonia, Latvia,
Lithuania, Russia, Belorus and Ukraine. The Division engages in
processing activities in Finland and Latvia. Aspokem is also engaged
in East-West chemical trading.
1-3/2008 1-3/2007 Change 1-12/2007
Net Sales, MEUR 31.5 29.9 1.6 123.8
Operating Profit, MEUR 0.7 1.0 -0.3 3.1
Personnel 132 121 11 132
The demand for chemicals continued at a fairly steady level during
the first quarter. The general price level also remained unchanged as
the price for crude oil continued to be high. However, the insecurity
reflecting the situation in the United States was felt in customers'
purchasing behavior. The expectations concerning a potential drop in
prices delayed purchasing decisions and reduced the volumes for
certain products, particularly in the Scandinavian and the Baltic
markets. In contrast, demand continued at a good level in Russia and
Ukraine, where net sales saw strong growth.
The mild winter reduced the sales of automotive chemicals, such as
anti-freeze agents and windscreen washer liquids. The sales trend was
higher in industrial chemicals and plastic raw materials.
The total net sales of the Chemicals Division increased. The insecure
market situation was reflected in earnings, which remained clearly
weaker year on year in the first quarter.
The Division has prepared to integrate its operations with the
raw-material operations of the acquired Kauko-Telko. The new raw
material business will more than double the current net sales, which
will enable more efficient global procurement and even stronger
expansion in the Russian and other Eastern European markets.
Aspo Shipping
The Aspo Shipping Division consists of ESL Shipping and its
subsidiaries and affiliate. ESL Shipping is the leading dry bulk sea
transport company operating in the Baltic Sea area. As of the end of
the period the fleet operated by the company comprised 15 units.
1-3/2008 1-3/2007 Change 1-12/2007
Net Sales, MEUR 21.0 21.8 -0.8 85.1
Operating Profit, MEUR 3.2 3.6 -0.4 25.1
Personnel 222 247 -25 239
The market situation in dry bulk cargo was good both in international
markets and in the Baltic Sea region. The warm weather facilitated
winter traffic. The reduced transport capacity and problems related
to both shore equipment and the fleet posed a challenge to business
operations. MS Tali was damaged at the beginning of February as it
touched ground off the coast of Norway, and was mostly out of traffic
in the first quarter. A fire at LKAB damaged the harbor equipment in
Luleå, which made the shipping of iron ore and pellets more
difficult.
Despite the adversities, the Division managed to increase its
comparable net sales year on year. MS Arkadia, which was sold in
early 2007, continued in traffic throughout the first quarter, and is
included in the comparative figures for last year. Extraordinary
expenses weakened the profitability of operations; as a result,
operating profit for the first quarter fell behind last year's
figures.
The total transport volume amounted to 3.5 million tons (3.9), with
the steel industry accounting for 57% and the energy industry for
34%. Except for Luleå, we encountered no significant problems with
the availability of goods during this quarter.
The first of the two 20,000 gross register ton vessels that are being
constructed in India for the Shipping Division should be completed
towards the end of 2008, with the other due in 2009.
Aspo Systems
The Aspo Systems Division comprises Autotank Ltd and its
subsidiaries. Autotank is the leading Nordic supplier of service
station maintenance services and automated dispensing systems.
Autotank has subsidiaries in Sweden, Norway, Estonia, Latvia,
Lithuania and Poland, as well as a joint venture in Russia.
1-3/2008 1-3/2007 Change 1-12/2007
Net Sales, MEUR 12.7 11.4 1.3 57.7
Operating Profit, MEUR -0.4 -0.8 0.4 -1.5
Personnel 309 310 -1 309
The good market situation in the service station industry has
continued. The factors behind this trend include both mergers and
acquisitions in the industry, resulting in the renovation of station
networks, and the development of technology, which has caused
customers to launch extensive investment programs. The technology
investments are mainly related to the chip card upgrade and the
distribution of new fuel mixtures.
Thanks to the mild winter, it has been possible to handle a larger
number of equipment installations than normally. The good demand in
the first quarter and the favorable weather conditions increased the
net sales of the Autotank Group by more than 6%. Net sales grew in
Finland, Norway and Estonia, in particular.
In early 2008 maintenance services, the biggest unit of the Division,
concluded a new maintenance agreement in Sweden, which entered into
force from the beginning of the second quarter.
The positive trend in sales also influenced earnings. For the first
time, the aggregate operating result of the Division, excluding
Sweden, showed a profit.
The reorganization of the Swedish operations that was commenced
towards the end of last year progressed well. Even though the
program's impact on earnings was only partly reflected on the
operations in the first quarter, the operating loss reduced by half
compared with last year. The aggregate operating result for the first
quarter improved significantly, and remained only slightly in the
red.
NET SALES
Aspo Group's net sales for January-March 2008 amounted to EUR 65.2
million compared with EUR 63.1 million in the corresponding period
last year. Chemicals and Systems Divisions were able to increase
their net sales over the previous year. Due to diminished capacity,
the net sales of the Shipping Division somewhat reduced in comparison
to last year.
Net Sales by Division, MEUR
1-3/2008 1-3/2007 Change 1-12/2007
Chemicals 31.5 29.9 1.6 123.8
Shipping 21.0 21.8 -0.8 85.1
Systems 12.7 11.4 1.3 57.7
TOTAL 65.2 63.1 2.1 266.6
Net Sales by Market Area, MEUR
1-3/08 1-3/07 Change 1-12/07
Finland 36.3 36.0 0.3 140.1
Nordic countries 15.0 16.4 -1.4 72.4
Baltic countries 3.5 4.4 -0.9 18.4
Russia, etc. 10.4 6.3 4.1 35.7
Total 65.2 63.1 2.1 266.6
The significance of Russia and other CIS markets in Aspo's business
will be further emphasized when the Shipping Division's raw material
transports from Russia are included in the Russian market area. When
the calculation is carried out this way, the distribution of net
sales between Finland and Russia is as follows:
1-3/08 1-3/07 Change 1-12/07
Finland 27.2 25.2 2.0 104.6
Russia, etc. 19.5 17.1 2.4 71.5
EARNINGS
Aspo Group recorded an operating profit of EUR 2.5 million or 3.9% of
net sales (EUR 3.0 million, or 4.8% of net sales). Planned
depreciation totaled EUR 2.4 million (EUR 2.4 million). The Group's
net financial costs amounted to EUR 0.8 million (EUR 0.7 million).
The profit before taxes was EUR 1.7 million (EUR 2.4 million) and the
net profit for the period totaled EUR 1.2 million (EUR 1.8 million).
Operating Profit by Division, MEUR
1-3/2008 1-3/2007 Change 1-12/2007
MEUR MEUR MEUR MEUR
Chemicals 0.7 1.0 -0.3 3.1
Shipping 3.2 3.6 -0.4 25.1
Systems -0.4 -0.8 0.4 -1.5
Group Administration -1.0 -0.8 -0.2 -2.9
TOTAL 2.5 3.0 -0.5 23.8
INVESTMENTS
The Group invested EUR 3.4 million (EUR 7.5 million) in
January-March, primarily in advance payments on Shipping Division's
vessel purchases.
Investments by Division, MEUR
1-3/2008 1-3/2007 Change 1-12/2007
MEUR MEUR MEUR MEUR
Chemicals 0.0 4.8 -4.8 5.7
Shipping 2.2 2.4 -0.2 3.8
Systems 0.2 0.3 -0.1 1.4
Group Administration 1.0 0.0 1.0 0.1
TOTAL 3.4 7.5 -4.1 11.0
FINANCING
The Group's financial situation was healthy. Liquid assets totaled
EUR 13.8 million (EUR 9.1 million) at the end of the period. There
was a total of EUR 33.5 million (EUR 36.5 million) in
interest-bearing liabilities on the consolidated balance sheet at the
end of the period. Interest-free liabilities totaled EUR 33.5 million
(EUR 47.9 million). The Group's gearing was 31.3% (54.7%) and the
equity ratio adjusted for deferred tax liabilities was 45.5% (35.4%).
PERSONNEL
Aspo Group's personnel averaged 675 (687) from January 1 to March 31,
2008, compared with 691 for the entire financial year 2007.
Average Personnel by Division
1-3/2008 1-3/2007 Change 1-12/2007
Chemicals 132 121 11 132
Shipping 222 247 -25 239
Systems 309 310 -1 309
Group Administration 12 9 3 11
TOTAL 675 687 -12 691
SHARES AND SHAREHOLDERS
From January to March 2008 a total of 851,435 Aspo Plc shares worth
EUR 5.5 million, or 3.2% of the stock were traded on the OMX Nordic
Exchange in Helsinki. During the period, the stock reached a high of
EUR 6.85 and a low of EUR 6.10. The average price was EUR 6.49 and
the closing price EUR 6.55. The market capitalization excluding
treasury shares was EUR 169.3 million at the end of the period.
On March 31, 2008, Aspo Plc's registered share capital was EUR
17,686,664.37 and the number of shares was 26,398,503. The company
held 552,111 of its own shares, representing 2.09% of Aspo Plc's
share capital.
Aspo Plc has on April 1, 2008, disposed of 1,500 shares to Group
Treasurer Harri Seppälä within the context of the company's
management incentive program.
At the end of the period, the number of Aspo Plc shareholders was
4,960. A total of 678,594 shares, or 2.6% of the total share capital
were nominee registered or held by non-domestic shareholders.
PROSPECTS FOR 2008
Insecurity in the world's raw material markets increased at the
beginning of the year. The main concern is the decline of economic
growth in the United States and its potential impact on Europe and
Asia.
Aspo's business operations focus on narrow niche sectors. The growth
and profitability of operations mainly depend on demand from the
industrial sector in the Baltic Sea area and the CIS market. In the
Nordic countries, a stable basis for demand appears to be continuing
in fiscal 2008. The growth trend in the Eastern markets - in Russia
and Ukraine, in particular - is also expected to continue.
The organic growth of the Group's net sales is expected to continue,
and a good operational performance is expected for fiscal 2008. The
Kauko-Telko acquisition will significantly increase Aspo Group's net
sales, and is expected to have a positive impact on earnings per
share during the current fiscal year as well.
Aspo Chemicals
Insecurity in the markets will probably increase until a more
detailed picture of the impact of the United States economic
situation on the global economy emerges. The prices for
petrochemicals follow the changes in the demand for oil and oil
prices. The impact in Europe largely depends on the overall economic
situation and the strength of the euro.
The organic growth in the net sales of the Chemicals Division appears
to be continuing. Modest growth is expected in the Nordic countries,
while strong growth appears to be continuing in the CIS countries.
The integration of Kauko-Telko's raw material business will be
carried out during the next few months, which will result in
considerable growth in the Division's net sales. Operating profit is
also expected to grow.
The largest risks for the Chemicals Division are related to the
potentially negative impact of the European Union's REACH regulation.
Other risks include political and financial instability in Russia and
Ukraine.
Aspo Shipping
The international dry bulk cargo market appears to be continuing more
strongly than usual, and good demand is expected to continue in the
Baltic Sea region as well.
The company's operations have become more diversified over the past
few years, and a wide service range for the needs of exporting and
importing industry in the Baltic Sea region have been developed
besides traditional shipping. The steel industry has become the
company's largest customer group. The proportion of the energy
industry is one-third.
The transport capacity will be lower than planned during the rest of
the year due to the repair schedule for MS Tali and removal of leased
tonnage. The new tonnage under construction cannot be taken into use
in traffic this year. In order to suppress the impact of the reduced
capacity on net sales, we will enhance the efficiency of our
operations and lease external tonnage. The current situation does not
hold realistic potential for increasing operating profit compared
with last year.
The currency risks involved in the Shipping Division's operations
are, for the most part, hedged by forward contracts. To protect
ourselves against the risks associated with the fluctuation in fuel
prices, our customer contracts include special bunker clauses.
Aspo Systems
Brisk market conditions are expected to continue in fuel
distribution. In the Nordic countries and the new EU countries,
demand will be boosted by investments in technology, mainly related
to the equipment and software required for the chip card upgrade. The
level of automation in service station networks will continue to be
enhanced; smaller manned stations will be automated and new unmanned
stations will be established in connection with shopping malls in
densely populated areas. The CIS countries will also see investments
in the construction of large manned service stations, besides
automation. Payment cards are gradually becoming more common in these
markets, and extensive projects related to card payments are being
planned.
The corporate acquisitions carried out by Autotank over the past few
years have been successfully integrated, and the Group has become a
market leader in its field in the entire Baltic Sea region. We
believe that, with such a good beginning of the year in Sweden and in
the entire Autotank Group, earnings will turn clearly upward this
fiscal year.
The net sales of the Division are expected to continue growing, and
earnings for 2008 are expected to show a clear profit.
Helsinki, April 29, 2008
ASPO Plc
Board of Directors
ASPO GROUP INCOME STATEMENT
1-3/08 1-3/07 1-12/07
MEUR % MEUR % MEUR %
NET SALES 65.2 100.0 63.1 100.0 266.6 100.0
Other operating income 0.5 0.7 10.8 4.1
Depreciation and write-downs -2.4 -3.7 -2.4 -3.8 -9.8 -3.7
OPERATING PROFIT 2.5 3.9 3.0 4.8 23.8 8.9
Financial income and expenses -0.8 -1.2 -0.7 -1.1 -2.4 -0.9
PROFIT BEFORE TAXES 1.7 2.6 2.4 3.7 21.4 8.0
PROFIT FOR THE PERIOD 1.2 1.8 1.8 2.8 15.4 5.8
Profit attributable
to shareholders 1.2 1.8 15.3
Minority interest 0.1
ASPO GROUP BALANCE SHEET 3/08 3/07 Change 12/07
MEUR MEUR % MEUR
ASSETS
Non-Current Assets
Intangible assets 2.6 1.3 100.0 2.6
Goodwill 10.1 10.5 -3.8 10.1
Tangible assets 48.4 54.7 -11.5 47.3
Available-for-sale assets 0.2 0.2 0.2
Long-term receivables 2.3 2.2 4.5 2.5
Shares in associated companies 1.1 1.4 -21.4 1.1
Total Non-Current Assets 64.7 70.3 -8.0 63.8
Current Assets
Inventories 23.8 21.5 10.7 24.0
Sales and other receivables 36.8 42.7 -13.8 40.0
Cash and bank deposits 13.8 9.1 51.6 13.1
Total Current Assets 74.4 73.3 1.5 77.2
TOTAL ASSETS 139.1 143.6 -3.1 141.0
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' Equity
Share capital 17.7 17.5 1.1 17.7
Other shareholders' equity 45.5 32.7 39.1 45.3
Shareholders' equity attributable
to equity holders of the parent 63.0 50.1 25.7 62.8
Minority interest 0.2 0.1 0.2
Long-term liabilities 23.8 28.2 -15.6 25.7
Short-term liabilities 52.1 65.2 -20.1 52.3
TOTAL SHAREHOLDERS' EQUITY
AND LIABILITIES 139.1 143.6 -3.1 141.0
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
A = Share Capital
B = Premium Fund
C = Fair Value Fund
D = Other Funds
E = Repurchased Shares
F = Translation Difference
G = Retained Earnings
H = Total
I = Minority Interest
J = Total Shareholders' Equity
MEUR A B C D E F G H I J
Balance at
12/31/2007 17.7 4.3 -1.0 0.5 -3.0 0.0 44.3 62.8 0.2 63.0
Translation
differences -0.2
Increase in
hedging reserve -0.8
Share of
deferred taxes 0.5
Net profit for
the period 1.2
Share repurchase -0.5
Balance at
3/31/2008 17.7 4.3 -1.3 0.5 -3.5 -0.2 45.5 63.0 0.2 63.2
Balance at
12/31/2006 17.5 2.5 0.0 0.2 -1.8 0.1 39.7 58.1 0.1 58.2
Translation
differences 0.0
Increase in
hedging reserve 0.0
Share of
deferred taxes 0.0
Net profit for
the period 1.8
Dividend payment -10.5
Share disposal 0.2 0.4
Balance at
3/31/2007 17.5 2.5 0.0 0.4 -1.4 0.1 31.0 50.1 0.1 50.2
Accounting principles
All figures are unaudited. This interim report has been prepared in
accordance with the IAS 34 (Interim Reports) standard. The accounting
principles that were applied in the preparation of the financial
statements of December 31, 2007 have been applied in the preparation
of this interim report.
ASPO GROUP CASH FLOW STATEMENT
1-3/08 1-3/07 1-12/07
MEUR MEUR MEUR
Net Operational Cash Flow 4.8 0.6 8.5
INVESTMENTS
Investments in tangible and
intangible assets -3.5 -2.8 -5.7
Gains on the sale of tangible
and intangible assets 11.2
Purchases of subsidiary shares -4.5 -4.7
Total Cash Flow From Investments -3.5 -7.3 0.7
FINANCING
Repurchase of shares -0.4 -1.6
Change in short-term borrowings 0.2 4.8 6.8
Change in long-term receivables 0.1 0.1
Change in long-term borrowings -0.6 -1.4
Dividends paid -10.6
Total Financing -0.7 4.8 -6.7
Impact of changes in exchange rates 0.1
Increase / Decrease in Liquid Funds 0.6 -1.9 2.6
Liquid funds in beginning of year 13.2 9.1 9.1
Liquid funds and used
overdraft limit at period end 11.6 7.2 11.7
Used overdraft limit at period end 2.2 1.9 1.5
Liquid funds at period end 13.8 9.1 13.2
KEY FIGURES AND RATIOS
1-3/08 1-3/07 1-12/07
Earnings/share, EUR 0.05 0.07 0.59
Diluted earnings/share, EUR 0.05 0.07 0.56
Equity/share, EUR 2.44 1.94 2.43
Equity Ratio, % 45.5 35.4 45.1
Gearing, % 31.3 54.7 32.4
FINANCIAL REPORTS
Aspo will publish Interim Reports in 2008 as follows:
for the second quarter on August 21, 2008
for the third quarter on October 23, 2008
FINANCIAL INFORMATION
Aspo has arranged a press conference for the media and analysts to be
held today, April 29, 2008 starting at 10:00 at Palace Gourmet,
Eteläranta 10,
00130 Helsinki.
ASPO Plc
Gustav Nyberg Dick Blomqvist
CEO CFO
For more information, please contact
Gustav Nyberg, +358 40 503 6420
gustav.nyberg@aspo.fi
Aspo is a conglomerate focusing on sectors that require extensive,
specialist knowledge. Our customers include companies in the energy
and process industry sectors, in particular. Aspo's net sales
amounted to EUR 266.6 million in 2007. Aspo Chemicals accounted for
about 46%, Aspo Shipping for about 32%, and Aspo Systems for about
22% of this figure.
Distribution:
OMX Nordic Exchange Helsinki
The Media
www.aspo.com
