(Translation of the Estonian original)
MANAGEMENT REPORT
GENERAL INFORMATION
The principal activity of Eesti Telekom Group, the parent company of which is AS
Eesti Telekom (registration number 10234957; address: Valge 16, 19095 Tallinn),
is the provision of telecommunications services.
Since 1999, the shares of AS Eesti Telekom have been listed on the Tallinn and
London securities markets (OMX: ETLAT / LSE: EETD).
Changes in the Eesti Telekom Group structure
AS Eesti Telekom Council has given the Board approval to initiate mergers and
enter into relevant agreements with the goal to simplify Eesti Telekom Group
structure, by merging AS EMT with its 100% subsidiaries EMT Esindused AS and AS
Mobile Wholesale, and Elion Ettevõtted AS with its 100% subsidiary Elion Esindus
AS. The aim is to achieve greater efficiency in business processes. The mergers
are planned to be concluded by August 2009 at the latest. The planned merger
will not cause any changes in financial reporting as the results of EMT Group
and Elion Group are already consolidated.
As of 11 February 2009, BiTA Service Management has merged with IT
Koolituskeskuse OÜ.
Ownership structure of AS Eesti Telekom
During the first quarter of 2009, there were no significant changes in the
structure of the AS Eesti Telekom shareholders. The Eesti Telekom majority
shareholder TeliaSonera AB (through Baltic Tele AB) continues to own 60.12% of
the company's shares.
As of the end of the first quarter, the ratio of freely traded shares converted
to GDRs was 12.71%. Of these, 12.81% were converted into GDRs traded on the
London Stock Exchange.
As of 31 March 2009, the 10 largest shareholders in AS Eesti Telekom were:
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--------------------------------------------------------------------------------
| | 31 March 2009 |
--------------------------------------------------------------------------------
| | No of shares | Participation |
--------------------------------------------------------------------------------
| | Changes since |
| | 31 December |
| | 2008 |
--------------------------------------------------------------------------------
| Baltic Tele AB | 82,936,29 | 60.12% | 0 |
| | 9 | | |
--------------------------------------------------------------------------------
| Ministry of Finance | 33,346,46 | 24.17% | 0 |
| | 4 | | |
--------------------------------------------------------------------------------
| Development Fund | 4,138,636 | 3.00% | 0 |
--------------------------------------------------------------------------------
| SEB clients | 2,818,746 | 2.04% | (45,988) |
--------------------------------------------------------------------------------
| Deutsche Bank (GDR accounts) | 2,246,838 | 1.63% | (17,382) |
--------------------------------------------------------------------------------
| ING Luxembourg S.A. | 2,055,783 | 1.49% | 0 |
--------------------------------------------------------------------------------
| Clearstream Banking Luxembourg | 578,301 | 0.42% | (6,675) |
| S.A. clients | | | |
--------------------------------------------------------------------------------
| UniCredit Bank Austria AG | 472,148 | 0.34% | (24,238) |
--------------------------------------------------------------------------------
| Mellon Treaty Omnibus | 363,473 | 0.26% | (28,679) |
--------------------------------------------------------------------------------
| State Street Bank and Trust | 335,945 | 0.24% | 0 |
| Omnibus Account | | | |
--------------------------------------------------------------------------------
AS Eesti Telekom shares
In the first quarter of 2009, the price of AS Eesti Telekom shares increased by
18.97%. The share price at the beginning of the quarter was 4.10 EUR and 4.64
EUR at the end of the quarter. The highest and lowest share prices during the
reporting period were 5.25 EUR and 4.10 EUR respectively. The turnover for the
reporting period was 13.5 million EUR.
The price of AS Eesti Telekom shares in the first quarter of 2009 has moved on
higher levels than the indexes of OMX Tallinn and OMX Tallinn 10 tradeable
shares.
BUSINESS ACTIVITIES
Management commentary: The Group's sales revenues in the first quarter were
primarily impacted by regulations (European Union regulations applied on the
mobile sector) and the economic downturn (reduction of sales of goods and
changes in consumer behavior). At the same time, there is a continuing growth of
mobile postpaid, mobile and fixed broadband and TV customers. Thanks to
efficiency programs that were previously implemented it was possible to
compensate the loss of revenues by a proportional decrease of expenses and to
maintain the EBITDA margin.
Significant financial indicators
Eesti Telekom Group
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| | Q1 2009 | Q1 2008 | Change, % |
--------------------------------------------------------------------------------
| Total revenues, million EUR | 85.4 | 94.9 | (10.0) |
--------------------------------------------------------------------------------
| EBITDA, million EUR | 33.0 | 36.8 | (10.3) |
--------------------------------------------------------------------------------
| Margin, % | 38.7 | 38.8 | |
--------------------------------------------------------------------------------
| EBIT, million EUR | 23.0 | 27.9 | (17.6) |
--------------------------------------------------------------------------------
| Margin, % | 26.9 | 29.4 | |
--------------------------------------------------------------------------------
| EBT, million EUR | 24.0 | 28.9 | (16.8) |
--------------------------------------------------------------------------------
| Profit for the period, million EUR | 24.0 | 28.9 | (16.8) |
--------------------------------------------------------------------------------
| Basic earnings per share, EUR | 0.17 | 0.21 | (16.7) |
--------------------------------------------------------------------------------
| Comprehensive income for the period, | 24.0 | 28.9 | (16.8) |
| million EUR | | | |
--------------------------------------------------------------------------------
| CAPEX, million EUR | 7.8 | 7.6 | 3.2 |
--------------------------------------------------------------------------------
| Net gearing, % | (25.9) | (29.5) | |
--------------------------------------------------------------------------------
| ROA, % | 7.4 | 8.7 | |
--------------------------------------------------------------------------------
| ROE, % | 8.4 | 10.0 | |
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Mobile communications segment
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| | Q1 2009 | Q1 2008 | Change, % |
--------------------------------------------------------------------------------
| Total revenues, million EUR | 47.3 | 55.9 | (15.4) |
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| EBITDA, million EUR | 17.5 | 21.0 | (16.8) |
--------------------------------------------------------------------------------
| Margin, % | 37.0 | 37.6 | |
--------------------------------------------------------------------------------
| EBIT, million EUR | 13.2 | 17.0 | (22.6) |
--------------------------------------------------------------------------------
| Margin, % | 27.9 | 30.4 | |
--------------------------------------------------------------------------------
| EBT, million EUR | 13.8 | 17.4 | (20.6) |
--------------------------------------------------------------------------------
| Profit for the period, million EUR | 13.8 | 17.4 | (20.6) |
--------------------------------------------------------------------------------
| Comprehensive income for the period, | 13.8 | 17.4 | (20.6) |
| million EUR | | | |
--------------------------------------------------------------------------------
| CAPEX, million EUR | 4.8 | 3.6 | 30.8 |
--------------------------------------------------------------------------------
| ROA, % | 9.3 | 12.1 | |
--------------------------------------------------------------------------------
| ROE, % | 11.6 | 15.6 | |
--------------------------------------------------------------------------------
Broadband services segment
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Change, % |
--------------------------------------------------------------------------------
| Total revenues, million EUR | 46.5 | 48.8 | (4.8) |
--------------------------------------------------------------------------------
| EBITDA, million EUR | 15.8 | 15.8 | 1.0 |
--------------------------------------------------------------------------------
| Margin, % | 34.1 | 32.3 | |
--------------------------------------------------------------------------------
| EBIT, million EUR | 11.0 | 11.3 | (2.7) |
--------------------------------------------------------------------------------
| Margin, % | 23.6 | 23.1 | |
--------------------------------------------------------------------------------
| EBT, million EUR | 10.9 | 11.3 | (3.6) |
--------------------------------------------------------------------------------
| Profit for the period, million EUR | 10.9 | 11.3 | (3.6) |
--------------------------------------------------------------------------------
| Comprehensive income for the period, | 10.9 | 11.3 | (3.6) |
| million EUR | | | |
--------------------------------------------------------------------------------
| CAPEX, million EUR | 2.8 | 3.6 | (20.5) |
--------------------------------------------------------------------------------
| ROA, % | 6.3 | 6.3 | |
--------------------------------------------------------------------------------
| ROE, % | 8.0 | 8.3 | |
--------------------------------------------------------------------------------
IT services segment
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Change, % |
--------------------------------------------------------------------------------
| Total revenues, million EUR | 3.9 | 5.1 | (22.1) |
--------------------------------------------------------------------------------
| EBITDA, million EUR | (0.2) | 0.2 | N/A |
--------------------------------------------------------------------------------
| Margin, % | (5.3) | 4.9 | |
--------------------------------------------------------------------------------
| EBIT, million EUR | (1.0) | (0.1) | N/A |
--------------------------------------------------------------------------------
| Margin, % | (25.3) | (2.9) | |
--------------------------------------------------------------------------------
| EBT, million EUR | (1.0) | (0.2) | N/A |
--------------------------------------------------------------------------------
| Profit for the period, million EUR | (1.0) | (0.2) | N/A |
--------------------------------------------------------------------------------
| Comprehensive income for the period, | (1.0) | (0.2) | N/A |
| million EUR | | | |
--------------------------------------------------------------------------------
| CAPEX, million EUR | 0.2 | 0.3 | (42.9) |
--------------------------------------------------------------------------------
| ROA, % | (8.9) | (1.7) | |
--------------------------------------------------------------------------------
| ROE, % | (14.0) | (3.3) | |
--------------------------------------------------------------------------------
Sales revenues, operating costs, and profit
The Group's sales revenues reached 85.4 million EUR in the first quarter of 2009
(1st quarter 2008:
94.9 million EUR), and were primarily impacted by
regulations that the European Union applies to the mobile sector and by the
economic downturn.
Mobile communications segment The consolidated turnover for the first quarter of
2009 reached
47.3 million EUR, decreasing by 15% compared to the first quarter
of 2008 (1st quarter 2008: 55.9 million EUR). The reason for the decrease in
total revenues was a reduction in revenues from call services caused by a drop
in retail and interconnection prices, which was partially compensated by the
growth of volumes for mobile data communications and subcontracting services.
Compared to a year ago, a decrease was also experienced in revenues received
from retailing and wholesaling during the first quarter, which was caused by
changes in consumer behavior. In addition, call minutes initiated by the
customers, as well as the number of call minutes entering the EMT network
decreased by 2% compared to the first quarter of 2008, which resulted from the
customers' wish to limit consumption.
As of the end of the first quarter of 2009, the EMT customer base was larger by
14 thousand compared to the previous year, reaching 766 thousand active SIM
cards (31 March 2008: 751 thousand cards). Compared to the previous year, the
number of contractual customers increased by 15 thousand, thereby reaching 488
thousand by the end of the first quarter of 2009 and the number of active users
of pre-paid cards remained unchanged at 278 thousand. EMT assesses its market
share of active SIM cards to be 47%. The estimated penetration of active cards
in Estonia is 120%.
In March EMT introduced an additional feature for the SurfPort mobile portal,
which enables modern mobile phones to access the majority of common websites
from the Internet. To date, only WAP sites that were especially created for
mobile phones could be accessed on phone screens. The new feature significantly
expands the choice of information available to mobile users, without the need
for a computer or new phone.
Pursuant to the resolution of the Communications Board, the interconnection fee
for AS EMT, Elisa Eesti AS and Tele2 Eesti AS was fixed at 0.11 EUR for the
period 1 July 2007 to 30 June 2008. For the period 1 July 2008 to 30 June 2009,
the Competition Board that is the legal successor to the Communications Board
established a fee of 0.09 EUR per minute for the termination of voice calls in
the mobile phone networks of AS EMT, Elisa Eesti AS and Tele2 Eesti AS.
Based on a decision dated 26 March 2009, the Competition Board announced new
market analysis results, based on which ProGroup Holding OÜ was declared an
undertaking with significant market power in the market for the termination of
voice calls in its mobile phone network, in addition to AS EMT, Elisa Eesti AS
and Tele2 Eesti AS. According to the resolution, within the framework of the
price control obligation, the given companies will be obligated to apply
benchmark-based interconnection fees that correspond to the average in the
European countries until 30 June 2012, which makes 0.09 EUR per minute the
maximum tariff to be applicable as of 1 July 2009. The maximum rate for
interconnection fees to be established for the periods 1 July 2010 to 30 June
2011 and 1 July 2011 to 30 June 2012 will be announced by the Competition Board
at least 2 months before the beginning of the corresponding period, but pursuant
to the decision, the decrease or increase in the interconnection fees to be
applied shall not be more than 10%.
The sales revenues for the broadband services segment reached 46.5 million EUR
in the first quarter
(1st quarter 2008: 48.8 million EUR). Compared to the same
period in 2008, the greatest increase in revenues resulted from the sale of
international interconnection services and triple-play solutions, which
increased by 27% and 16% respectively. The increase in revenues from
international interconnection services resulted primarily from increased minute
volumes. At the same time, the revenues for call services earned from end
consumers decreased by 16% due to a decrease in minute volumes. Based on a
significant increase in the relative importance of the volume and revenues of
triple-play solutions, the revenues from monthly fees for call connections and
Internet connections decreased in the last quarter by 10% and 14% respectively.
However, the revenues earned from the sale of triple-play solutions considerably
exceeded the given decrease. The revenues from the broadband services segment
decreased by 5% compared to the same period last year. The decrease in revenues
was primarily related to a reduction in the sales volumes of telecommunications
and IT goods.
In the first quarter, the total number of Elion customers with permanent
Internet connections increased during a year by 9,000 connections, reaching
176.5 thousand by the end of March (31 March 2008: 167.5 thousand). The company
assesses that Elion's market share based on the permanent connections of private
customers has not changed and continues to be 54%.
In March, Elion started to standardize the product portfolio provided by
triple-play solutions to Elion's private customers, by introducing two updated
Kodulahendus products and gradually transferring existing Kodulahendus customers
to the new products. Both products are triple-packages that differ based on the
downloading speeds of the Internet connections and the number of television
channels. The new Kodulahendus products include supplementary free television
viewing locations and free WiFi use in the Elion WiFi network throughout
Estonia.
At the end of the March, Elion also launched a Start package with a 16.30-EUR
monthly fee that fulfills basic triple package needs and thereby entered the
discount service market with the new product. The Start package was introduced
within the framework of the “Join us!” project designed to introduce people to
the Internet, which was initiated in March by the Behold the World! Foundation
and Eesti Telekom.
The number of Elion triple-package users increased during a year by 23,500,
reaching 82.1 thousand as of
31 March (31 March 2008: 58.6 thousand). By the
end of the first quarter, Elion had 86.9 thousand IP and cable television
customers (31 March 2008: 63.2 thousand). Elion assesses that the company's
market share in the cable coverage market increased by 6% during the year,
reaching 28% by the end of the first quarter
(31 March 2008: 22%).
In March, Elion started the sale of used IT equipment on the
http://leiunurk.elion.ee website, which fulfills two goals for the company -
preserves the environment by recycling high-quality equipment and enables
computers to be purchased in a complicated economic situation.
By the end of first quarter, the number of Elion's active call interfaces
totaled 461 thousand (31 March 2008: 473 thousand interfaces). The reduction in
number of call interfaces resulted from an expected reduction in the number of
telephone connections in the private segment and a reduction in the number of
pay phones throughout Estonia.
Elion assesses its market share for call minutes initiated in the fixed network
to be 80% (31 March 2008: 81%). The market share for local call minutes is 82%
(31 March 2008: 83%), 68% for international call minutes (31 March 2008: 66%)
and 70% for call minutes made to mobile phones (31 March 2008: 71%). The
increase of the international call market share is explained by a change in
accounting methods. The company assesses that the given market share has
remained at the same level for the last few years.
At the end of the March, Elion notified the other operators of price changes
that will come into force on
1 May 2009 for interconnection services and access
services. This is related to requirements based on domain-specific regulations
that obligate Elion to review its prices at least once a year and are based on
the expenditure statements for the previous period. The price changes according
to service are primarily related to the reduction or increase of volumes. For
instance, the monthly fee for copper pairs and the telephone network
interconnection fees increased on average by 20% and 12% respectively. At the
same time, the broadband access fees decreased by 9-20% depending on speed.
The 2009 first quarter results for the IT services segment include the
consolidated data from the companies of the IT Koolituskeskuse OÜ Group that was
acquired in October 2008.
In the first quarter of 2009, the sales revenues for the IT services segment
reached 3.9 million EUR
(1st quarter 2008: 5.1 million EUR). Compared to the
same period in the previous year, the consolidated sales revenues decreased by
22%, whereas the sales revenues for IT goods decreased by 53% and the sales
revenues for permanent services decreased by 6%, and the sales revenues for
project-based services increased by 30%. The sales revenues for services
provided within the Eesti Telekom Group decreased by 27% compared to the first
quarter of the previous year, while the sales revenues for services provided to
customers outside the Group increased by 13%.
The reduction of the national budget by 0.5 billion EUR in 2009 had a
significant impact on the Estonian
IT sector. A number of procurements have
been postponed or the results of completed procurements cancelled.
The sales turnover for infrastructure solutions in the first quarter was
significantly smaller than in the same period last year (1.0 million EUR vs. 2.1
million EUR). The reason is the general decline in the IT market. Currently, the
same recessionary trend is being experienced by all IT companies that deal with
merchandise sales.
In the project business, important projects in the first quarter included the
introduction of document management at Estonian Post and the continued
development of various information systems at Piletilevi, the Unemployment
Insurance Fund and Ragn-Sells.
In the field of permanent services, AS MicroLink Eesti won the procurement for
the maintenance of computer workstations organized by the Tallinn City Office in
the first quarter. In addition, during the first quarter, MicroLink Eesti
started to provide server hosting services to the East-Tallinn Central Hospital,
the Harku Rural Municipality Government and Estonian Railways.
The operating costs of the Eesti Telekom Group decreased by 10% in the first
quarter of 2009 compared to the same period of 2008, reaching 52.7 million EUR
(1st quarter 2008: 58.3 million EUR).
The operating costs in the mobile communications segment decreased by 14%
compared to the first quarter of 2008 to 29.9 million EUR (1st quarter 2008:
34.9 million EUR). The greatest decrease was in the operating costs related to
retailing and wholesaling, which corresponds to the drop in merchandise sales
turnovers.
A decrease was also experienced by interconnection costs based on a
drop in interconnection prices. The efficiency programs also had an impact on
the decrease of the operating costs that were related to a reduction in the
number of workers, as well as marketing, IT and network costs.
The operating costs in the broadband services segment decreased during the last
quarter by 7% compared to the same period in 2008, reaching 30.8 million EUR
(1st quarter 2008: 33.2 million EUR). The principal part of the decrease in
operating costs resulted from a decrease in direct sales costs related to a
decline in retail volumes. A significant impact on the decrease in operating
costs also resulted from the efficiency projects initiated last year, which are
related to a reduction in maintenance costs for network resources, IT and
transport costs and also to a reduction in the number of workers in the group.
The operating costs in the IT services segment decreased in the first quarter by
14% compared to the same period last year, reaching 4.2 million EUR (1st quarter
2008: 4.8 million EUR). The operating costs for the quarter were affected by
increased costs accompanying the consolidation of the IT Koolituskeskus, as an
independent company, whereby the operating costs of AS MicroLink Eesti increased
by 3%.
The Eesti Telekom Group EBITDA decreased in the first quarter of 2009 by 10%
compared to the same period in the previous year, reaching 33.0 million EUR (1st
quarter 2008: 36.8 million EUR). The EBITDA in the mobile communications
services segment decreased by 17% in the first quarter compared to the same
period last year. Since the decrease in the operating costs were almost
proportional to the reduction in turnover, the EBITDA margin for the mobile
communications services segment has decreased by less than one percent. In the
first quarter, the EBITDA for the broadband services segment increased by 1%
compared to the same period in the previous year, reaching 15.8 million EUR (1st
quarter 2008: 15.8 million EUR). The EBITDA for the IT services segment in the
first quarter of 2009 was -0.2 million EUR (1st quarter 2008: profit of 0.2
million EUR). The Group's EBITDA margin in the first quarter of 2009 was 39%,
which remained at the same level as the margin for the same period in the
previous year.
The Group's depreciation costs reached 10.0 million EUR in the first quarter of
2009, by increasing 12% compared to the same period in 2008 (1st quarter 2008:
8.9 million EUR). The greatest increase in depreciation costs resulted from the
IT services segment where depreciation costs reached 0.8 million EUR in the
first quarter of 2009 (1st quarter 2008: 0.4 million EUR). This was caused by a
discount of 0.4 million EUR in February of this year on the goodwill recognized
on the balance sheet after the acquisition of
IT Koolituskeskuse OÜ.
In the first quarter, the Eesti Telekom Group earned EBIT of 23.0 million EUR,
which was a decrease of 18% compared to the same period in the previous year
(1st quarter 2008: 27.9 million EUR).
The profit for the Eesti Telekom Group in the first quarter of 2009 was 24.0
million EUR (1st quarter 2008: 28.9 million EUR). The basic earnings per share
were 0.17 EUR (1st quarter 2008: 0.21 EUR). The Group's comprehensive income in
first quarter of 2009 was 24.0 million EUR (1st quarter 2008: 28.9 million EUR).
Statement of financial position and cash flows
As of 31 March 2009, the Eesti Telekom Group balance sheet totaled 332.8 million
EUR (31 December 2008: 319.5 million EUR). Compared to the beginning of the
year, the non-current assets have decreased by
1.3 million EUR, the balance of
which reached 185.7 million EUR by the end of the quarter. During first three
months of the year, the Group's current assets have increased by 14.5 million
EUR, reaching
147.1 million EUR by the end of March (31 December 2008: 132.6
million EUR). Cash and cash equivalents,
as well as short-term financial
investments have increased by 22.9 million EUR, reaching 78.0 million EUR by the
end of the period.
As of 31 March 2009, the Eesti Telekom Group equity was 298.5 million EUR, which
is 24.0 million EUR more than at the end of 2008 (31 December 2008: 274.5
million EUR). The increase in equity resulted from a first-quarter profit. As of
the end of March, non-current liabilities totaled 2.1 million EUR (31 December
2008: 2.1 million EUR) and current liabilities totaled 32.2 million EUR (31
December 2008: 42.9 million EUR). The net debt of the Eesti Telekom Group at the
end of the first quarter was -77.5 million EUR and the net gearing ratio was
-25.9% (31 December 2008: -54.5 million EUR and -20%).
The Eesti Telekom Group cash flow from operating activities during the first
three months of 2009 was
29.0 million EUR (3 months of 2008: 28.6 million EUR).
The Group's cash flow from investment activities was 25.9 million EUR (3 months
of 2008: 35.2 million EUR). The cash flow into the acquisition of tangible and
intangible fixed assets during the first three months was 7.8 million EUR (3
months of 2008:
7.6 million EUR). In the first quarter of 2009, the mobile
communications segment invested 4.8 million EUR (1st quarter 2008: 3.6 million
EUR). In mobile communications, in addition to the constant development of the
GSM network, a developmental priority was the implementation of technologies to
support high-speed mobile data communications. The majority of data
communications usage by EMT customers occurs in the 3G network, which enables
the use of high-quality and rapid Internet connections at speeds approaching
those of ADSL at conveniently manageable prices. Since EMT is the only operator
in Estonia that provides EDGE data communications throughout its GSM coverage
area, then investments in new base stations is primarily directed at expanding
external and internal 3G coverage in cities and town. At the same time, the
constant improvement of the GSM network continued. Investments into the
broadband services segment totaled 2.8 million EUR (1st quarter 2008: 3.6
million EUR). The principal part of the capital volumes were related to the
development of network resources, changes in the product portfolio and the
improvement of and expansion of the availability of the triple-service packages.
In the first quarter of 2009, the IT services segment invested 0.2 million EUR
into fixed assets (1st quarter 2008: 0.3 million EUR).
During three months, the Eesti Telekom Group cash flow used in financing
activities was less than 0.1 million EUR, similarly to the first quarter of
2008.
Shareholders' general meeting
The regular general meeting of AS Eesti Telekom shareholders will take place on
20 May 2009 at 12 pm in Tallinn at Valge 16. Starting on 27 April 2009, the 2008
annual report and draft resolutions for the general meeting will be available on
the Internet at http://www.telekom.ee and at Eesti Telekom at Valge 16, Tallinn
on workdays from 10 am to 2 pm. Questions related to the general meeting can be
submitted through the
AS Eesti Telekom website, by telephone at 6 311 212, or
by e-mail to mailbox@telekom.ee.
Dividends
The Management Board of AS Eesti Telekom will make a proposal at the
shareholders' general meeting to distribute and pay out 92.6 million EUR or 0.67
EUR per share as dividends, based on the number of dividend-paying shares, or
137,954,528 shares.
In 2008, 92.6 million EUR was distributed as dividends among the shareholders,
or 0.67 EUR per share.
Definitions
EBITDA margin = EBITDA / Net sales x 100%
EBIT margin = EBIT / Net sales x 100%
Net debt = Interest bearing liabilities - cash and cash equivalents - short term
investments
Net gearing = Net debt / Owner's equity x 100%
ROA = Profit for the period / Average total assets x 100%
ROE = Profit before tax / Average equity x 100%
Basic earnings per share = Profit for the period / Average number of shares
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
| | Notes | I Quarter | I Quarter | 2008 |
| | | 2009 | 2008 | |
--------------------------------------------------------------------------------
| Net sales | 2.1, | 85,417 | 94,857 | 395,588 |
| | 2.3 | | | |
--------------------------------------------------------------------------------
| Cost of production | 2.1 | (48,658) | (53,078) | (225,777) |
--------------------------------------------------------------------------------
| Gross profit | 2.1 | 36,759 | 41,779 | 169,811 |
--------------------------------------------------------------------------------
| Sales, administrative, and | 2.1 | (14,095) | (14,187) | (57,972) |
| research & development | | | | |
| expenses | | | | |
--------------------------------------------------------------------------------
| Other operating revenues | 2.1 | 483 | 402 | 2,001 |
--------------------------------------------------------------------------------
| Other operating expenses | 2.1 | (164) | (99) | (543) |
--------------------------------------------------------------------------------
| Operating profit | 2.1 | 22,983 | 27,895 | 113,297 |
--------------------------------------------------------------------------------
| Finance income | | 1,112 | 1,134 | 3,527 |
--------------------------------------------------------------------------------
| Finance costs | | (22) | (37) | (56) |
--------------------------------------------------------------------------------
| Finance income, net | 2.1 | 1,090 | 1,097 | 3,471 |
--------------------------------------------------------------------------------
| Net income / (expenses) | 2.1 | (53) | (107) | (182) |
| from associated companies | | | | |
--------------------------------------------------------------------------------
| Profit before tax | 2.1 | 24,020 | 28,885 | 116,586 |
--------------------------------------------------------------------------------
| Income tax on dividends | 2.1 | - | - | (24,664) |
--------------------------------------------------------------------------------
| Profit for the period | 2.1 | 24,020 | 28,885 | 91,922 |
--------------------------------------------------------------------------------
| Other comprehensive income | | | | |
--------------------------------------------------------------------------------
| Exchange differences on | 2.1 | (1) | - | 1 |
| translating foreign | | | | |
| subsidiaries | | | | |
--------------------------------------------------------------------------------
| Other comprehensive income | 2.1 | (1) | - | 1 |
| for the period | | | | |
--------------------------------------------------------------------------------
| Total comprehensive income | 2.1 | 24,019 | 28,885 | 91,923 |
--------------------------------------------------------------------------------
| Profit attributable to: | | | | |
--------------------------------------------------------------------------------
| Equity holders of the | 2.1 | 23,993 | 28,803 | 91,703 |
| parent | | | | |
--------------------------------------------------------------------------------
| Minority interest | 2.1 | 27 | 82 | 219 |
--------------------------------------------------------------------------------
| | | 24,020 | 28,885 | 91,922 |
--------------------------------------------------------------------------------
| Comprehensive income | | | | |
| attributable to: | | | | |
--------------------------------------------------------------------------------
| Equity holders of the | 2.1 | 23,992 | 28,803 | 91,704 |
| parent | | | | |
--------------------------------------------------------------------------------
| Minority interest | 2.1 | 27 | 82 | 219 |
--------------------------------------------------------------------------------
| | | 24,019 | 28,885 | 91,923 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share for | 7 (e) | | | |
| profit attributable to the | | | | |
| equity holders of the | | | | |
| parent during the | | | | |
| reporting period | | | | |
| (expressed in EUR) | | | | |
--------------------------------------------------------------------------------
| Basic earnings per share | | 0.17 | 0.21 | 0.66 |
--------------------------------------------------------------------------------
| Diluted earnings per share | | 0.17 | 0.21 | 0.66 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EBITDA | 2.1 | 33,026 | 36,837 | 150,088 |
--------------------------------------------------------------------------------
| Depreciation, amortization | 2.1, 3 | (10,043) | (8,942) | (36,791) |
| and write-downs | | | | |
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
--------------------------------------------------------------------------------
| | Notes | 31 March | 31 December | 31 March |
| | | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| ASSETS | | | | |
--------------------------------------------------------------------------------
| Non-current assets | | | | |
--------------------------------------------------------------------------------
| Property, plant and | 3 | 164,193 | 165,542 | 152,879 |
| equipment | | | | |
--------------------------------------------------------------------------------
| Intangible fixed assets | 3 | 13,713 | 14,592 | 13,179 |
--------------------------------------------------------------------------------
| Investments in associates | 2.2, 5 | 623 | 676 | 750 |
--------------------------------------------------------------------------------
| Other financial fixed | | 7,143 | 6,115 | 7,418 |
| assets | | | | |
--------------------------------------------------------------------------------
| Total non-current assets | 2.2 | 185,672 | 186,925 | 174,226 |
--------------------------------------------------------------------------------
| Current assets | | | | |
--------------------------------------------------------------------------------
| Assets classified as | | - | - | 208 |
| held-for-sale | | | | |
--------------------------------------------------------------------------------
| Inventories | 6 | 11,045 | 10,861 | 11,811 |
--------------------------------------------------------------------------------
| Trade and other | | 58,054 | 66,576 | 64,983 |
| receivables | | | | |
--------------------------------------------------------------------------------
| Short-term investments | | - | 31,956 | 1,101 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | | 78,013 | 23,206 | 89,085 |
--------------------------------------------------------------------------------
| Total current assets | 2.2 | 147,112 | 132,599 | 167,188 |
--------------------------------------------------------------------------------
| TOTAL ASSETS | 2.2 | 332,784 | 319,524 | 341,414 |
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | | | | |
--------------------------------------------------------------------------------
| Equity | | | | |
--------------------------------------------------------------------------------
| Capital and reserves | 7 | | | |
| attributable to equity | | | | |
| holders of the parent | | | | |
--------------------------------------------------------------------------------
| Share capital | | 88,169 | 88,169 | 88,169 |
--------------------------------------------------------------------------------
| Share premium | | 22,753 | 22,753 | 22,753 |
--------------------------------------------------------------------------------
| Statutory legal reserve | | 8,817 | 8,817 | 8,817 |
--------------------------------------------------------------------------------
| Retained earnings | | - | 1 | - |
--------------------------------------------------------------------------------
| Net profit for the period | | 178,267 | 154,274 | 184,068 |
--------------------------------------------------------------------------------
| Total capital and reserves | | 298,006 | 274,014 | 303,807 |
| attributable to equity | | | | |
| holders of the parent | | | | |
--------------------------------------------------------------------------------
| Minority interest | 2.2, 7 | 540 | 513 | 815 |
--------------------------------------------------------------------------------
| Total equity | | 298,546 | 274,527 | 304,622 |
--------------------------------------------------------------------------------
| Non-current liabilities | | | | |
--------------------------------------------------------------------------------
| Interest bearing loans and | 8 | 375 | 375 | 48 |
| borrowings | | | | |
--------------------------------------------------------------------------------
| Retirement benefit | 9 | 122 | 138 | 192 |
| obligations | | | | |
--------------------------------------------------------------------------------
| Provisions | 10 | 1,443 | 1,443 | 1,338 |
--------------------------------------------------------------------------------
| Non-interest bearing | | 127 | 127 | - |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Total non-current | 2.2 | 2,067 | 2,083 | 1,578 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Current liabilities | | | | |
--------------------------------------------------------------------------------
| Trade and other payables | | 31,902 | 42,399 | 34,571 |
--------------------------------------------------------------------------------
| Interest bearing loans and | 8 | 174 | 259 | 164 |
| borrowings | | | | |
--------------------------------------------------------------------------------
| Retirement benefit | 9 | 66 | 66 | 310 |
| obligations | | | | |
--------------------------------------------------------------------------------
| Provisions | 10 | 29 | 190 | 169 |
--------------------------------------------------------------------------------
| Total current liabilities | 2.2 | 32,171 | 42,914 | 35,214 |
--------------------------------------------------------------------------------
| Total liabilities | | 34,238 | 44,997 | 36,792 |
--------------------------------------------------------------------------------
| TOTAL EQUITY AND | 2.2 | 332,784 | 319,524 | 341,414 |
| LIABILITIES | | | | |
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT
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| | Notes | I Quarter | I Quarter |
| | | 2009 | 2008 |
--------------------------------------------------------------------------------
| Operating activities | | | |
--------------------------------------------------------------------------------
| Net profit for the period | | 24,020 | 28,885 |
--------------------------------------------------------------------------------
| Adjustments for: | | | |
--------------------------------------------------------------------------------
| Depreciation, amortisation and | 2.1, 3 | 10,043 | 8,942 |
| impairment of fixed and intangible | | | |
| assets | | | |
--------------------------------------------------------------------------------
| (Profit) / loss from sales and | | (184) | (189) |
| discards of fixed assets | | | |
--------------------------------------------------------------------------------
| Net (income) / expenses from | | 53 | 107 |
| associated companies | | | |
--------------------------------------------------------------------------------
| Provisions | | (161) | (117) |
--------------------------------------------------------------------------------
| Financial items | | (1,616) | (1,633) |
--------------------------------------------------------------------------------
| Miscellaneous non-cash items | | (20) | 4 |
--------------------------------------------------------------------------------
| Cash flow before change in working | | 32,135 | 35,999 |
| capital | | | |
--------------------------------------------------------------------------------
| Change in current receivables | | 6,683 | 297 |
--------------------------------------------------------------------------------
| Change in inventories | | (184) | (262) |
--------------------------------------------------------------------------------
| Change in current liabilities | | (10,449) | (8,406) |
--------------------------------------------------------------------------------
| Change in working capital | | (3,950) | (8,371) |
--------------------------------------------------------------------------------
| Cash flow after changes in working | | 28,185 | 27,628 |
| capital | | | |
--------------------------------------------------------------------------------
| Interest received | | 781 | 1,052 |
--------------------------------------------------------------------------------
| Interest paid | | (11) | (94) |
--------------------------------------------------------------------------------
| Cash flow from operating activities | 2.2 | 28,955 | 28,586 |
--------------------------------------------------------------------------------
| Investing activities | | | |
--------------------------------------------------------------------------------
| Intangible and tangible fixed assets | 2.2, 3 | (7,835) | (7,593) |
| acquired | | | |
--------------------------------------------------------------------------------
| Intangible and tangible fixed assets | | 206 | 207 |
| divested | | | |
--------------------------------------------------------------------------------
| Net change in interest-receivables | | 31,956 | 43,257 |
| short maturities | | | |
--------------------------------------------------------------------------------
| Net cash changes of other long-term | | 1,593 | (703) |
| receivables | | | |
--------------------------------------------------------------------------------
| Cash flow from investing activities | 2.2 | 25,920 | 35,168 |
--------------------------------------------------------------------------------
| Cash flow before financing | | 54,875 | 63,754 |
| activities | | | |
--------------------------------------------------------------------------------
| Financing activities | | | |
--------------------------------------------------------------------------------
| Repayment of finance lease | 8 | (77) | (38) |
| liabilities | | | |
--------------------------------------------------------------------------------
| Cash flow used in financing | 2.2 | (77) | (38) |
| activities | | | |
--------------------------------------------------------------------------------
| Cash flow for the year | 2.2 | 54,798 | 63,716 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at | 2.2 | 23,206 | 25,359 |
| beginning of year | | | |
--------------------------------------------------------------------------------
| Cash flow for the year | 2.2 | 54,798 | 63,716 |
--------------------------------------------------------------------------------
| Effect of foreign exchange rate | 2.2 | 9 | 10 |
| changes | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at end of | 2.2 | 78,013 | 89,085 |
| period | | | |
--------------------------------------------------------------------------------
