HONKARAKENNE OYJ INTERIM REPORT 20 AUGUST 2009 at 9.00 AM
HONKARAKENNE OYJ'S INTERIM REPORT, 1 JANUARY - 30 JUNE 2009
Summary
INTERIM REPORT, 1 APRIL - 30 JUNE 2009
Honkarakenne's consolidated net sales for the second quarter of the year
amounted to EUR 16.1 million, a decrease of 41.9% on the previous year's
corresponding period (EUR 27.6 million). Profit before taxes showed a profit of
EUR 0.7 million (profit of EUR 2.4 million) and the earnings/share ratio was a
profit of EUR 0.16 (profit of EUR 0.53).
INTERIM REPORT, 1 JANUARY - 30 JUNE 2009
Honkarakenne's consolidated net sales for the half year of 2009 amounted to EUR
27.6, a decrease of 39.3 % on the previous year's corresponding period (EUR 45.4
million). Profit before taxes showed a loss of EUR 0.6 million (profit of EUR
1.9 million) and the earnings/share ratio was a loss of EUR 0.11 (profit of EUR
0.39). The weak advance sales in the second half of the previous year were
reflected in the delivery volumes at the start of this year in all market areas.
If the market forecast holds, we can expect an improvement this year on last
year's total profit figure.
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| KEY FIGURES | 4-6 | 4-6/ | 1-6 | 1-6 | change | 1-12 |
| | /2009 | 2008 | /2009 | /2008 | % | /2008 |
--------------------------------------------------------------------------------
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| Net sales, MEUR | 16.1 | 27.6 | 27.6 | 45.4 | -39.3 | 78.4 |
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| Operating | 0.8 | 2.7 | -0.5 | 2.2 | -120.0 | -0.1 |
| profit/loss, MEUR | | | | | | |
--------------------------------------------------------------------------------
| Profit/loss before | 0.7 | 2.4 | -0.6 | 1.9 | -131.1 | -1.5 |
| taxes, MEUR | | | | | | |
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| Average number of | | | 381 | 405 | | 398 |
| personnel | | | | | | |
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| Earnings/share (EPS), | | | -0.11 | 0.39 | | -0.32 |
| EUR | | | | | | |
--------------------------------------------------------------------------------
| Shareholders | | | 4.4 | 5.27 | | 4.5 |
| equity/share, EUR | | | | | | |
--------------------------------------------------------------------------------
Review by Honkarakenne Oyj's President & CEO, Esko Teerikorpi, in connection
with the interim report:
”In the report period Honkarakenne's net sales decreased in all the company's
key markets due to the difficult market conditions. A significantly smaller drop
was recorded in domestic net sales than in exports. Exports to eastern European
countries and Russia have suffered the most, while exports to Germany, France
and Japan have seen a notably smaller decrease than in the equivalent period
last year.
The severe fall in the markets, which began last autumn, is the worst in the
history of the operating sector. In the first months of the year, domestic net
sales in the sector as a whole saw a fall of 30% and exports were cut by as much
as 47%. In Honkarakenne, consolidated net sales in the first months of the year
remained 39% below the previous year's figure, with domestic net sales
decreasing by 24.5% and exports by 43.8%.
Last autumn, Honkarakenne launched a cost-cutting exercise, with the aim of
achieving almost 30% savings on fixed costs during 2009, compared with the
figure posted last year.
In its operational development the company has focused on evolving more
cost-effective operating processes and increasing cost-effectiveness in
production and in the procurement of raw materials. A new saw line was installed
during the winter months in the sawmill operated by Honkarakenne's associated
company located in the Republic of Karelia. The objective is to increase
production line capacity. The sawmill's operating conditions were further
boosted by the devaluation of the rouble, allowing it to produce high-quality
sawn goods at competitive prices for use at the company's production facilities
in Karstula and Alajärvi. A decision was made to close down the Paltamo factory;
production from the factory will be transferred to the company's main production
plants in early autumn.
In the review period, the company launched a new eco round log as well as the
Honka Major multi-laminated log. Production of the new eco round log required
investment in a new gluing line, which came on stream in June this year. The
production of the Honka Duo eco round log uses less energy, the quality of the
log is superior to that of the single-piece round log, and there is very little
difference in the production costs compared with the traditional single-piece
round log. At 270 mm the innovative Honka Major is the largest of the
multi-laminated logs produced by Honkarakenne. It is designed to be used in
single-family housing and buildings requiring a smart appearance. It already
meets the new energy regulations that are due to come into force at the
beginning of 2010 in Finland.
France was the first country, in early 2009, where the Honka Fusion product
concept was launched. Honka Fusion lends itself particularly well to modern
design solutions, such as the combination of glass, stone, timber and steel. It
allows designers the freedom to create sustainable and ecological solid wood
houses.
A DVD, which was produced to present Honkarakenne as a company, has received
numerous prizes at international film festivals.
The company's annual net sales will remain appreciably below last year's level.
The profit figure is forecast to be just into the red. Thanks to the vigorous
cost adjustment and efficiency measures, the conditions are right for an
improvement on last year's result.”
NET SALES
Honkarakenne's consolidated net sales from January to June 2009 were EUR 27.6
million, compared to EUR 45.4 million in the same period last year. Net sales
decreased by EUR 17.8 million and remained 39.3 % below last year's figure.
Domestic net sales decreased by EUR 4.2 million (-24.5%), and export net sales
by EUR 13.6 million (-43.8 %).
Geographical distribution of net sales:
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| DEVELOPMENT OF SALES | | | |
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| Distribution of net | 1-6/200 | 1-6/200 | | | |
| sales, % | 9 | 8 | | | |
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| Finland | 47.1 % | 37.9 % | | | |
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| Central Europe | 21.4 % | 19.6 % | | | |
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| Far East | 12.9 % | 8.8 % | | | |
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| Other countries | 18.6 % | 33.7 % | | | |
--------------------------------------------------------------------------------
| Total | 100.0 % | 100.0 % | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Net sales 1000 euros | 4-6/200 | 4-6/200 | 1-6/2009 | 1-6/2008 | % change |
| | 9 | 8 | | | |
--------------------------------------------------------------------------------
| Finland | 7 024 | 10 283 | 12 996 | 17 214 | -24.5 % |
--------------------------------------------------------------------------------
| Central Europe | 3 476 | 5 802 | 5 915 | 8 905 | -33.6 % |
--------------------------------------------------------------------------------
| Far East | 2 243 | 2 654 | 3 560 | 3 997 | -10.9 % |
--------------------------------------------------------------------------------
| Other countries | 3 341 | 8 946 | 5 120 | 15 325 | -66.6 % |
--------------------------------------------------------------------------------
| Total | 16 084 | 27 685 | 27 591 | 45 440 | -39.3 % |
--------------------------------------------------------------------------------
The Group's order book was EUR 20.0 million at the end of June. The
corresponding figure from last year was EUR 32.3 million.
DEVELOPMENT OF PROFIT
The operating result for January-June amounted to a loss of EUR 0.5 million
(profit of EUR 2.2 million), and profit before taxes showed a loss of EUR 0.6
million (profit of EUR 1.9 million). The adjustment measures launched last
autumn were already reflected in the cost structure in the first months of the
year, but the whole impact will only be evident in the second half of the
current year.
The cost saving measures have targeted personnel, travel, marketing, product
development and administration.
FINANCING AND INVESTMENTS
The Group's financial position has kept unchanged compared to the last quarter
but in the same time improved compared to the end of the year 2008. Additionally
group's financial position has weakened compared to the same period last year.
The equity ratio stood at 32.3% (36.9%) and interest-bearing net liabilities at
EUR 18.3 million (EUR 14.9 million). Group liquid assets totalled EUR 2.7
million (EUR 2.4 million). Gearing stood at 117.2% (78.9%). Capital expenditure
totalled EUR 1.7 million (EUR 2.4 million).
MARKET DEVELOPMENT
Housing starts in Finland are expected to shrink in the current year by almost a
third and holiday accommodation starts by about 15% from last year's figures.
Total annual net sales of EUR 237 million are forecast in the log house
construction industry, which is 25% below last year's level. Domestic annual
sales in the sector are forecast to achieve EUR 142 million (-18 %), while
exports will be at the level of EUR 95 million (-34 %).
The figures available at the beginning of July indicated that domestic sales
(deliveries + orderbook for 2009) in the sector remained 19% below and exports
36% below last year's sales figures at the equivalent time. In terms of
deliveries, domestic figures lagged 30% behind and export figures 47% behind
last year's figures. The differences in the 2008 and 2009 orderbooks for the
sector as a whole were a 10% reduction for domestic orders and 18% for export
orders.
In terms of advance sales in the first half of the year, Honkarakenne
experienced a fall of 18% in domestic sales and 41% in export sales on last
year's equivalent period. Business was shadowed in the second quarter by a
continuing lack of demand brought on by the recession. Requests for quotes are
numerous, but the economic uncertainties slow down the decision-making process.
Advance sales are expected to liven up somewhat towards the end of the year. The
general forecast for advance sales in the log house sector is expected to be
reflected in Honkarakenne's annual advance sales figures.
PRODUCTS AND MARKETING
Production and deliveries of the new Honka Duo log commenced in June. In the
second quarter of the year, the first build using the new Honka Major logs was
delivered in Finland. The new products fulfilled expectations on the whole. Some
adjustments relating to raw material measurements and the drying process were
made to the Duo log in the initial stages of production.
“Talopeli” (“House Game”) software was introduced in Honkarakenne's Finnish
Internet marketing. Customers can use the software to assist in the budgeting of
their own construction projects. The software has generated a wealth of offer
enquiries and significant interest from potential new customers in Finland.
A film recounting the 50-year history of Honkarakenne has received much
recognition in Europe and the US.
Enhancing Internet services with a view to promoting new contacts and launching
a supporting media advertising campaign will be the focus of marketing measures
towards the end of the year.
RESEARCH AND DEVELOPMENT
In January-June consolidated R&D expenditure was EUR 0.2 million (EUR 0.5
million), representing 0.8% of net sales (1.1%). In the review period, the Group
did not capitalize any research expenditure.
STAFF
At the end of June, the Group employed on average 381 people. This is 24 less
than at the same time in the previous year. The reduction was mostly from the
parent company. When production is terminated at the subsidiary Finwood Oy's own
production plant and production is transferred to the Group's principal
production facilities in Karstula and Alajärvi, production personnel will be cut
by 18 people by the end of the autumn, representing the employees who were given
notice on 9 April 2009.
HONKARAKENNE OYJ'S ANNUAL GENERAL MEETING 2009, BOARD OF DIRECTORS AND
ACCOUNTANTS
Honkarakenne Oyj's annual general meeting was held on Friday 3 April 2009. The
general meeting confirmed the financial statements of the parent company and the
Group, and released the Board members and the President from liability for the
year of 2008. The annual general meeting decided that no dividend would be
payable for the financial year.
The following Board members were elected to continue in office: Mauri
Saarelainen, Tomi Laamanen, Mauri Niemi and Pirjo Ruuska. Lasse Kurkilahti and
Marko Saarelainen were elected as new members. The Board meeting elected Lasse
Kurkilahti as chairman.
KPMG Oy Ab, Authorized Public Accountants, was selected to continue as the
company's auditor with Ari Eskelinen as chief accountant.
HONKARAKENNE OYJ'S OWN SHARES AND AUTHORIZATION TO THE BOARD OF DIRECTORS
Honkarakenne Oyj repurchased 5,185 shares during the period under review, for an
average price of EUR 2.68 per share. At the end of the review period the company
held 213,885 of its B shares with a total nominal value of EUR 427,770.00 and a
total purchase price of EUR 1,137,564.73. These shares represent 5.71% of the
company's capital stock and 2.26% of the voting rights. The purchase cost has
been deducted from shareholders' equity in the consolidated financial
statements.
The Board of Directors has been granted a share repurchase authorization, valid
until 26 March 2010, to repurchase company shares following which the company
and its subsidiaries would hold a maximum of 10% of the company's capital stock.
The Board of Directors has also been granted authority, also valid until 26
March 2010, to dispose of 374,896 B shares.
CORPORATE GOVERNANCE
Honkarakenne Oyj observes the corporate governance code for listed companies
issued by the Finnish Securities Market Association. The company's website,
www.honka.com/Investors, provides more information on the corporate governance
systems.
CHANGES IN IFRS REPORTING
On 1 January 2009, the company adopted the revised IAS 1 standard for presenting
financial statements and the new IFRS 8 Operating Segments standard. The
application of the new standard will not change the data that is presented on
the Group segments. Honkarakenne only reports on one segment: the manufacture,
sale and marketing of log houses. Additional information is provided in
accordance with the following geographical breakdown: Finland, Central Europe,
Far East and other countries.
FUTURE OUTLOOK
During spring and summer, demand has levelled off to a substantially lower level
than that of last year. The market conditions in the company's principal markets
are expected to improve slightly, with the industry starting to climb out of the
deepest hole. Other positive contributory factors are the lower construction
costs and the low interest rate levels, both of which will boost demand. Major
projects will start to move only when the general economic situation improves.
Due to weak advance sales in the second half of last year and in the first part
of this year, net sales throughout the Finnish log industry are forecast to
decrease by 25-30% in the current financial year. Similarly, the annual
consolidated net sales of Honkarakenne are expected to be appreciably lower this
year than last year. Business expenditure has been adjusted to cope with the
distinctly smaller net sales, while significant cost savings will be sought in
the current year through various procedures and measures. Despite the declining
net sales, a higher annual profit figure than that of last year's is forecast
for the current year.
FORTHCOMING RISKS AND UNCERTAINTIES
The most significant risks in the near future are linked to the development of
the general economic situation. Honkarakenne has shown that it is capable of
adjusting its production capacity and cost levels to reflect market demand. It
is the view of the company's management that the amount of finance at the
Group's disposal is sufficient for the current year.
Unanticipated development trends in Russia and other eastern European countries
may incorporate risk factors.
The sawn goods markets have seen extensive adjustment measures in production and
in the short term, when demand picks up, we may experience delivery problems
linked to the availability of wood raw material.
REPORTING
This bulletin contains statements that relate to the future; these statements
are based on hypotheses that the company's management holds currently as well as
the decisions and plans that are currently in place. Although the management
believes hat the hypotheses relating to the future are well-founded, there is no
guarantee that the said hypotheses will prove to be correct.
This interim report is prepared in line with the requirements of the standard
IAS 34, Interim Reports. The principles adhered to in preparing the annual
financial statements for 2008 also apply to this interim report. The figures
have not been examined by the auditor.
HONKARAKENNE OYJ
Board of Directors
Further information: Esko Teerikorpi, President and CEO, tel. +358 20 575 7816,
+358 40 580 6111, esko.teerikorpi@honka.com.
This and previous press releases can be found on the company's website at
www.honka.com, Investors. The next interim report of 2009 will be published on
12 November 2009.
DISTRIBUTION
Helsinki Stock Exchange
Principal media
Financial Supervision
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| CONSOLIDATED STATEMENT OF | | | | | |
| COMPREHENSIVE INCOME | | | | | |
--------------------------------------------------------------------------------
| (unaudited) | 4-6 | 4-6 | 1-6 | 1-6 | 1-12 |
| | /2009 | /2008 | /2009 | /2008 | /2008 |
--------------------------------------------------------------------------------
| (MEUR) | | | | | |
--------------------------------------------------------------------------------
| Net sales | 16.1 | 27.6 | 27.6 | 45.4 | 78.4 |
--------------------------------------------------------------------------------
| Other operating income | 0.3 | 0.5 | 0.4 | 0.8 | 1.1 |
--------------------------------------------------------------------------------
| Change in inventories | -0.5 | 0.3 | -0.8 | 1.2 | -0.8 |
--------------------------------------------------------------------------------
| Production for own use | 0.1 | 0.0 | 0.1 | 0.1 | 0.3 |
--------------------------------------------------------------------------------
| Materials and services | -8.6 | -16.5 | -14.6 | -28.1 | -47.2 |
--------------------------------------------------------------------------------
| Employee benefit expenses | -3.3 | -4.7 | -6.8 | -8.7 | -15.8 |
--------------------------------------------------------------------------------
| Depreciations | -1.0 | -1.1 | -1.9 | -2.1 | -4.1 |
--------------------------------------------------------------------------------
| Other operating expenses | -2.3 | -3.4 | -4.6 | -6.4 | -11.8 |
--------------------------------------------------------------------------------
| Operating profit/loss | 0.8 | 2.7 | -0.5 | 2.2 | -0.1 |
--------------------------------------------------------------------------------
| Financial income and | -0.0 | -0.2 | -0.0 | -0.4 | -1.3 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Share of associated | -0.1 | -0.0 | -0.1 | 0.0 | -0.1 |
| companies' profit | | | | | |
--------------------------------------------------------------------------------
| Profit/loss before taxes | 0.7 | 2.4 | -0.6 | 1.9 | -1.5 |
--------------------------------------------------------------------------------
| Taxes | -0.1 | -0.6 | 0.2 | -0.5 | 0.4 |
--------------------------------------------------------------------------------
| Profit/loss for the | 0.6 | 1.9 | -0.4 | 1.4 | -1.1 |
| period | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other comprehensive | | | | | |
| income: | | | | | |
--------------------------------------------------------------------------------
| Translation differences | 0.0 | 0.0 | -0.0 | 0.2 | 0.0 |
--------------------------------------------------------------------------------
| Total comprehensive | 0.6 | 1.9 | -0.4 | 1.6 | -1.1 |
| Income for the period | | | | | |
| | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Attributable to: | | | | | |
--------------------------------------------------------------------------------
| Equity holders of the | 0.6 | 1,9 | -0.4 | 1.4 | -1.1 |
| parent | | | | | |
--------------------------------------------------------------------------------
| Minority interest | 0.0 | 0.0 | -0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| | 0.6 | 1.9 | -0.4 | 1.4 | -1.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings/share (EPS), EUR | | | | | |
--------------------------------------------------------------------------------
| Basic | 0.16 | 0.53 | -0.11 | 0.39 | -0.32 |
--------------------------------------------------------------------------------
| Diluted | 0.16 | 0.53 | -0.11 | 0.39 | -0.32 |
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| CONSOLIDATED BALANCE SHEET | 30.6.2009 | 30.6.2008 | 31.12.2008 |
| (unaudited) | | | |
--------------------------------------------------------------------------------
| (MEUR) | | | |
--------------------------------------------------------------------------------
| Assets | | | |
--------------------------------------------------------------------------------
| Non-current assets | | | |
--------------------------------------------------------------------------------
| Property, plant and equipment | 25.7 | 25.0 | 26.0 |
--------------------------------------------------------------------------------
| Goodwill | 0.5 | 0.5 | 0.5 |
--------------------------------------------------------------------------------
| Other intangible assets | 1.4 | 1.4 | 1.5 |
--------------------------------------------------------------------------------
| Investments in associated companies | 2.1 | 2.4 | 2.2 |
--------------------------------------------------------------------------------
| Other investments | 0.2 | 0.2 | 0.2 |
--------------------------------------------------------------------------------
| Receivables | 0.2 | 0.2 | 0.1 |
--------------------------------------------------------------------------------
| Deferred tax assets | 1.5 | 1.0 | 1.4 |
--------------------------------------------------------------------------------
| | 31.7 | 30.7 | 32.0 |
--------------------------------------------------------------------------------
| Current assets | | | |
--------------------------------------------------------------------------------
| Inventories | 11.3 | 14.2 | 12.5 |
--------------------------------------------------------------------------------
| Trade and other receivables | 8.4 | 12.2 | 9.1 |
--------------------------------------------------------------------------------
| Cash and bank receivables | 2.7 | 2.4 | 1.6 |
--------------------------------------------------------------------------------
| | 22.4 | 28.9 | 23.2 |
--------------------------------------------------------------------------------
| Total assets | 54.1 | 59.6 | 55.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 30.6.2009 | 30.6.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
| Shareholders' equity and liabilities | | | |
--------------------------------------------------------------------------------
| Equity attributable to equity holders | | | |
| of the parent | | | |
--------------------------------------------------------------------------------
| Capital stock | 7.5 | 7.5 | 7.5 |
--------------------------------------------------------------------------------
| Share premium | 0.5 | 0.5 | 0.5 |
--------------------------------------------------------------------------------
| Reserve fund | 5.3 | 5.3 | 5.3 |
--------------------------------------------------------------------------------
| Translation differences | 0.0 | 0.2 | 0.0 |
--------------------------------------------------------------------------------
| Retained earnings | 2.3 | 5.4 | 2.7 |
--------------------------------------------------------------------------------
| | 15.6 | 18.9 | 16.1 |
--------------------------------------------------------------------------------
| Minority share | 0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Total equity | 15.6 | 18.9 | 16.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current liabilities | | | |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 0.7 | 0.6 | 0.8 |
--------------------------------------------------------------------------------
| Provisions | 0.4 | 0.4 | 0.4 |
--------------------------------------------------------------------------------
| Intrest bearing debt | 18.7 | 15.0 | 19.2 |
--------------------------------------------------------------------------------
| Non-intrest bearing debt | 0.6 | 0.8 | 0.6 |
--------------------------------------------------------------------------------
| | 20.5 | 16.7 | 21.0 |
--------------------------------------------------------------------------------
| Current liabilities | | | |
--------------------------------------------------------------------------------
| Trade and other payables | 15.7 | 20.9 | 16.2 |
--------------------------------------------------------------------------------
| Tax liabilities | 0.0 | 0.6 | 0.0 |
--------------------------------------------------------------------------------
| Intrest bearing debt | 2.2 | 2.4 | 1.9 |
--------------------------------------------------------------------------------
| | 17.9 | 24.0 | 18.1 |
--------------------------------------------------------------------------------
| Total liabilities | 38.4 | 40.6 | 39.1 |
--------------------------------------------------------------------------------
| Total equity and liabilities | 54.1 | 59.6 | 55.2 |
--------------------------------------------------------------------------------
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| STATEMENT OF CHANGES IN EQUITY | |
| (unaudited) | |
--------------------------------------------------------------------------------
| 1000 EUR | Equity attributable to equity holders of the | | |
| | parent | | |
--------------------------------------------------------------------------------
| | a) | b) | c) | d) | e) | f) | Total | g) | Total |
| | | | | | | | | | equity |
--------------------------------------------------------------------------------
| Total | 7,498 | 520 | 5,316 | 179 | -942 | 6,03 | 18,608 | -8 | 18,600 |
| equity | | | | | | 7 | | | |
| 1.1.2008 | | | | | | | | | |
--------------------------------------------------------------------------------
| Translati | | | | -17 | | | -17 | 17 | 0 |
| on | | | | | | | | | |
| differenc | | | | | | | | | |
| e | | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | | | | | | -1,0 | -1,067 | | -1,067 |
| | | | | | | 67 | | | |
--------------------------------------------------------------------------------
| Repurchas | | | | | -208 | | -208 | | -208 |
| e of | | | | | | | | | |
| own | | | | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Transfer | | | | | 186 | | 186 | | 186 |
| of | | | | | | | | | |
| own | | | | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Result of | | | | | | 1,39 | 1,397 | 1 | 1,398 |
| the | | | | | | 7 | | | |
| period | | | | | | | | | |
--------------------------------------------------------------------------------
| Total | 7,498 | 520 | 5,316 | 162 | -964 | 6,36 | 18,899 | 10 | 18,909 |
| equity | | | | | | 7 | | | |
| 30.6.2008 | | | | | | | | | |
--------------------------------------------------------------------------------
| | a) | b) | c) | d) | e) | f) | Total | g) | Total |
| | | | | | | | | | equity |
--------------------------------------------------------------------------------
| Total | 7,498 | 520 | 5,316 | 27 | -1,124 | 3,81 | 16,056 | 9 | 16,065 |
| equity | | | | | | 9 | | | |
| 1.1.2009 | | | | | | | | | |
--------------------------------------------------------------------------------
| Translati | | | | -29 | | | -29 | | -29 |
| on | | | | | | | | | |
| differenc | | | | | | | | | |
| e | | | | | | | | | |
--------------------------------------------------------------------------------
| Repurchas | | | | | -14 | | -14 | | -14 |
| e of | | | | | | | | | |
| own | | | | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Result of | | | | | | -401 | -401 | -3 | -404 |
| the | | | | | | | | | |
| period | | | | | | | | | |
--------------------------------------------------------------------------------
| Total | 7,498 | 520 | 5,316 | -2 | -1,138 | 3,41 | 15,612 | 6 | 15,618 |
| equity | | | | | | 8 | | | |
| 30.6.2009 | | | | | | | | | |
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a) Share capital
b) Premium fund
c) Reserve fund
d) Translation difference
e) Own shares
f) Retained earnings
g) Minority interest
--------------------------------------------------------------------------------
| CONSOLIDATED CASH FLOW | 1.1.-30.6. | 1.1.-30.6. | 1.1.-31.12. |
| STATEMENT | 2009 | 2008 | 2008 |
| (Unaudited) | | | |
--------------------------------------------------------------------------------
| (MEUR) | | | |
--------------------------------------------------------------------------------
| Cash flow from operations | 2.3 | 2.5 | 0.8 |
--------------------------------------------------------------------------------
| Cash flow from investments. | -1.0 | -2.8 | -4.9 |
| net | | | |
--------------------------------------------------------------------------------
| Total cash flow from | -0.2 | 0.8 | 3.7 |
| financing | | | |
--------------------------------------------------------------------------------
| Increase in credit capital | 5.6 | 3.1 | 7.1 |
--------------------------------------------------------------------------------
| Decrease in credit capital | -5.6 | -0.9 | -1.5 |
--------------------------------------------------------------------------------
| Dividends paid | | -1.1 | -1.1 |
--------------------------------------------------------------------------------
| Other financial items | -0.2 | -0.0 | -0.8 |
--------------------------------------------------------------------------------
| Change in liquid assets | 1.1 | 0.5 | -0.4 |
--------------------------------------------------------------------------------
| Liquid assets at the | 1.6 | 1.9 | 1.9 |
| beginning of period | | | |
--------------------------------------------------------------------------------
| Liquid assets at the end of | 2.7 | 2.4 | 1.6 |
| period | | | |
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NOTES TO THE INTERIM REPORT
Calculation methods
This interim report is prepared in line with the requirements of the standard
IAS 34, Interim Reports. The principles adhered to in preparing the annual
financial statements for 2008 also apply to this interim report. This interim
report should be studied in conjunction with the 2008 financial statements.
On 1 January 2009, the Group adopted the revised IAS 1 standard for presenting
financial statements and the new IFRS 8 Operating Segments standard. Other
revised standards or interpretations have no bearing on this interim report.
The adoption of the IFRS 8 standard did not change the number of reported
segments, only the notes to the interim report. Honkarakenne has only one
operating segment: the manufacture, sale and marketing of log houses. Additional
information is provided in accordance with the following geographical breakdown:
Finland, Central Europe, Far East and other countries. Because the internal
reporting procedures applied by the management are in line with IFRS reporting
standards, additional detail is not required.
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| TANGIBLE ASSETS | |
--------------------------------------------------------------------------------
| (MEUR) | Tangible |
--------------------------------------------------------------------------------
| (Unaudited) | assets |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Acquisition cost 1.1.2009 | 66.2 |
--------------------------------------------------------------------------------
| Translation difference (+/-) | -0.2 |
--------------------------------------------------------------------------------
| Increase | 1.7 |
--------------------------------------------------------------------------------
| Decrease | -0.1 |
--------------------------------------------------------------------------------
| Transfers between balance sheet items | 0.0 |
--------------------------------------------------------------------------------
| Acquisition cost 30.06.2009 | 67.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Accumulated depreciation 1.1.2009 | -40.2 |
--------------------------------------------------------------------------------
| Translation difference (+/-) | 0.1 |
--------------------------------------------------------------------------------
| Disposals and reclassifications | 0.0 |
--------------------------------------------------------------------------------
| Depreciation for the period | -1.7 |
--------------------------------------------------------------------------------
| Accumulated depreciation 30.06.2009 | -41.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Book value 1.1.2009 | 26.0 |
--------------------------------------------------------------------------------
| Book value 30.06.2009 | 25.7 |
--------------------------------------------------------------------------------
Own shares
Honkarakenne acquired during the period under review 5,185 of its own B shares,
whose purchase price amounted to 13,8 meur.
--------------------------------------------------------------------------------
| CONTINGENT LIABILITIES | | |
--------------------------------------------------------------------------------
| (Unaudited) | | |
--------------------------------------------------------------------------------
| MEUR | 30.6.2009 | 30.6.2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| For own loans | | |
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| - Mortgages | 25.52 | 19.66 |
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| - Pledged shares | 0.36 | 0.57 |
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| - Other quarantees | 2.90 | 1.29 |
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| For others | | |
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| - Guarantees | 1.06 | 1.09 |
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| Leasing liabilities | 0.92 | 0.76 |
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| Rent liabilities | 0.14 | 0.22 |
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| Nominal values of forward exchange | 1.5 | 1.8 |
| contracts | | |
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Events in the circle of acquaintances
The circle of acquaintances consists of subsidiaries associated companies and
the company's management. The management included in the circle of acquaintances
comprises the Board of Directors, CEO and the company's managing committee.
There haven't been transactions with acquaintances during the reporting period.
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| KEY INDICATORS | | | | |
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| | | 1-6 | 1-6 | 1-12 |
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| (Unaudited) | | 2009 | 2008 | 2008 |
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| Earnings/share (EPS) | eur | -0.11 | 0.39 | -0.32 |
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| Return on equity | % | -2.5 | 7.5 | -6.6 |
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| Equity ratio | % | 32.3 | 36.9 | 33.0 |
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| Shareholders | eur | 4.4 | 5.27 | 4.5 |
| equity/share | | | | |
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| Net debt | MEUR | 18.3 | 14.9 | 19.5 |
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| Gearing | % | 117.2 | 78.9 | 121.6 |
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| Gross investments | MEUR | 1.7 | 2.4 | 5.1 |
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| | % of net sales | 6.2 | 5.3 | 6.5 |
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| Order book | MEUR | 20.0 | 32.3 | 23.7 |
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| Average number of | Staff | 187 | 198 | 195 |
| personnel | | | | |
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| | Workers | 194 | 207 | 203 |
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| | Total | 381 | 405 | 398 |
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| CALCULATION OF KEY INDICATORS | |
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| | Profit for the period attributable to equity | |
| | holders of parent | |
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| Earnings/share | ----------------------------------------- | |
| (EPS) | | |
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| | Average number of outstanding shares | |
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| | Profit before taxes - taxes | |
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| Return on equity % | ----------------------------------------- | x 100 |
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| | Total equity, average | |
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| | Total equity | |
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| Equity ratio, % | ----------------------------------------- | x 100 |
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| | Balance sheet total - advances received | |
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| Net debt | Interest-bearing debt - cash and cash | |
| | equivalents | |
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| | Interest-bearing debt - cash and cash | |
| | equivalents | |
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| Gearing, % | ----------------------------------------- | x 100 |
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| | Total equity | |
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| | Shareholders' equity | |
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| Shareholders | ----------------------------------------- | |
| equity/share | | |
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| | Number of shares outstanding at end of period |
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