LAROX CORPORATION INTERIM REPORT 23.10.2009 AT 8.30 AM
INTERIM FINANCIAL REPORT OF THE LAROX GROUP FOR THE PERIOD 1 JANUARY 2009 TO 30
SEPTEMBER 2009
Highlights of the review period Q1-Q3/2009
- The amount of new orders was EUR 78.7 million (EUR 159.0 million).
- Net sales were EUR 116.0 million (EUR 143.9 million)
- Operating result was EUR -0.7 million (EUR 11.7 million), -0.6% (8.1%) of net
sales
- Operating result without extraordinary items was EUR 4.0 million (EUR 11.7
million), 3.4% (8.1%) of net sales
- Result before tax was EUR -1.3 million (EUR 10.2 million)
- Earnings per share was EUR -0.13 (EUR 0.77)
- Due to the adjustment measures a total of EUR 4.6 million costs are booked to
third quarter.
Highlights of the period Q3/2009
- The amount of new orders was EUR 27.0 million (EUR 53.8 million)
- Net sales were EUR 32.0 million (EUR 58.8 million)
- Operating result was EUR -4.3 million (EUR 5.5 million, -13.3% (9.4%))
- Operating result without extraordinary items was EUR 0.3 million (EUR 5.5
million, -1.1% (9.4%))
- Result before tax was EUR -4.4 million (EUR 4.8 million)
Highlights after the review period
Certain biggest Larox shareholders have agreed with Outotec Oyj on October 15,
2009 on share exchange transactions, in which they will sell all their Larox
series A and B shares to Outotec. The shares to be sold correspond altogether to
94.40 per cent of all the votes in Larox, to 99.99 per cent of all Larox series
A shares and to 61.89 per cent of all Larox series B shares. The purchase price
for the shares shall be paid in the form of new Outotec shares. The completion
of the share exchange transactions is conditional on the receipt of necessary
approvals from the competition authorities. Upon completion of the share
exchange transactions, Outotec has announced to make a mandatory public tender
offer for all the remaining Larox series A and B shares.
BUSINESS OPERATIONS
Order backlog was EUR 36.6 million (EUR 110.1 million) at the end of the review
period and the amount of new orders was EUR 78.7 million (EUR 159.0 million).
More than 95% of Group net sales were generated by exports and foreign
operations.
PROFITS AND PROFITABILITY
The net sales for the preview period were EUR 116.0 million (EUR 143.9 million).
The Group showed an operating result of EUR -0.7 million (EUR 11.7 million),
i.e. -0.6% (8.1%) of net sales. Operating result for the three firs quarter in
2009 without extraordinary items was EUR 4.0 million, 3.4% of net sales. Larox
Group's result before tax for the nine months totaled EUR -1.3 million (EUR 10.2
million, 1 January 2008 to 30 September 2008), without extraordinary items the
result before tax was EUR 3.3 million (EUR 10.2 million).
To improve profitability and to adjust the organization and cost structure to
the weakened demand Larox has implemented measures during the review period.
Both lay-off and reduced working hours agreements have been contracted in the
Group. Larox's subsidiary in the Netherlands has closed down its local
Engineering and Procurement department. Operations have been centralized and
partly moved to China.
Larox continues adjustment measures and has started new negotiations with the
employee representatives.
The aim for these two phases is to reduce Larox's annual costs by approximately
6.5 million euros. It is estimated that these annual cost reductions will be
fully realized in 2011. These adjustment measures will generate a total of 4.6
million euros non-recurring costs, which are booked as a reservation in the
third quarter.
BALANCE SHEET AND FINANCING
By the end of September 2009 the Group balance sheet totaled EUR 106.5 million
(EUR 107.8 million). By the turn of the year the balance sheet total was EUR
118.1 million. The Group's net financing costs totaled EUR 0.7 million (EUR 1.5
million), i.e. 0.6% (1.0%) of the net sales. Net cash flow from operating
activities was EUR 2.3 million (EUR 16.4 million). The equity ratio was 31.3 %
(32.6 %) and at the end of the previous financial year (31 December 2008) it was
32.3 %.
INVESTMENTS
Larox Group's investments totaled EUR 2.4 million (EUR 6.2 million) including
machinery investments especially in Finland and in China and furthermore IT
applications, product development and replacement investments.
PERSONNEL
The average number of personnel employed by the Group during the review period
was 593 (526). At the end of the review period it was 569 (557) of whom 249
(266) worked for the parent company. The number of personnel increased
especially in China, the increase is for the preview period 40 persons. Larox
started assembly under its own subsidiary in china. in other countries,
especially within the area of Europe, the number of persons decreased due to the
adjustment measures. at the turn of the fiscal year the number of group
personnel totaled 593 and 279 in the parent company.
SHARES AND SHAREHOLDERS
During 1 January 2009 to 30 September 2009 trading in shares totaled 899,077,
which is 9.6 % of the total number of shares. The value of shares traded was EUR
5.9 million. During the review period the lowest share price was EUR 4.79
and the highest was EUR 8.10. The closing price of the share was 7.00 and
the total market value of the shares was EUR 66.0 million. At the end of
September there were 2.219 shareholders.
AUTHORIZATIONS TO THE BOARD OF DIRECTORS DECIDED IN THE ANNUAL GENERAL MEETING
OF SHAREHOLDERS
The authorization to the Board of Directors regarding the payment of a possible
additional dividend was not used during the review period. The authorization is
for the payment of an additional dividend of EUR 0.20 per share at the maximum,
should the economic situation of the company allow it. The Board of Directors
can decide on the dividend in question by 31 December 2009.
The authorization to the Board of Directors to decide on the purchase of own
B-series shares was not used during the review period. The authorization is for
the Board of Directors to decide on the purchase of own B-series shares in the
following way: The number of own B-series shares to be purchased is 500.000
shares at the maximum. The Board of Directors can purchase these shares only by
using the company's unrestricted shareholders' equity in public trading arranged
by Nasdaq OMX Helsinki Ltd. at fair value at the date of acquisition in a
proportion not pro rata to the shares owned by the shareholders. The
authorization is valid for 18 months from the date of the decision by the annual
meeting of shareholders.
The Board of Directors of Larox Corporation decided on 26 March 2009 on a
directed share issue for the reward payment from the measuring period 2007-2008
of the Share Ownership Plan 2007-2010. In the share issue 44,350 Larox
Corporation new B shares were issued and conveyed without consideration to the
key persons participating in the Share Ownership Plan according to the terms and
conditions of the plan. More detailed information on the incentive plan was
published on May 30, 2007. The decision on the directed share issue is based on
the authorization granted to the Board of Directors by the annual general
meeting of shareholders held on 30 March 2007. This decision was announced on 26
March 2009. The directed share issue does not affect the company's share
capital. At the end of the period, the company held 1,000 of its own B-shares,
which is 0.01% of the total number of shares or 0.002% of the total number of
votes.
EVENTS AFTER REVIEW PERIOD
Certain biggest Larox shareholders have agreed with Outotec Oyj on October 15,
2009 on share exchange transactions, in which they will sell all their Larox
series A and B shares to Outotec. The shares to be sold correspond altogether to
94.40 per cent of all the votes in Larox, to 99.99 per cent of all Larox series
A shares and to 61.89 per cent of all Larox series B shares. The purchase price
for the shares shall be paid in the form of new Outotec shares. The completion
of the share exchange transactions is conditional on the receipt of necessary
approvals from the competition authorities.
Upon completion of the share exchange transactions, Outotec has announced to
make a mandatory public tender offer for all series A and series B shares. The
consideration to be offered for each series A and series B share in the tender
offer equals to the consideration under the share transactions, i.e. 0.45
Outotec shares per each Larox series A share and 0.40 Outotec shares per each
Larox series B share. As required under the Finnish Securities Market Act, a
cash consideration of EUR 10.76 per each series A share and EUR 9.56 per each
series B share will be offered as an alternative. The amount of the cash
consideration is based on the closing price of Outotec share on NASDAQ OMX
Helsinki Ltd. on October 14, 2009. The transaction values Larox as a whole at
approximately EUR 93 million.
In connection with the share exchange transactions Capillary Oy has informed
Outotec that it will make an offer to Larox to purchase the 49 per cent share
held by Larox of Larox Flowsys Oy's share capital. Provided that the Board of
Directors of Larox decides on such sale after the completion of the share
exchange transactions, Outotec has confirmed that it will, after the completion
of the tender offer, contribute to
the fact that the shares in Larox Flowsys Oy owned by Larox will be assigned to
Capillary Oy for their fair price at the time of the sale and that Larox Flowsys
Oy shall be entitled to continue using the name "Larox" for an agreed period.
RISKS AND UNCERTAINTY FACTORS
Risk management is part of Larox Group's management and control system. It aims
at preventing negative phenomena, support the Group strategy and ensure
continuity of its operations and the wellbeing of its personnel. According to
Larox risks management system risks are divided into the following four risk
categories: business, operational, financial risks and risk of damage.
Larox operates on a global market where global economic trends affect its
business development, but the company is not at the mercy of changes in any
particular market area. The recent political unrest in sub-equatorial Africa
has caused the most uncertainty in Larox's business.
The demand risk of Larox products has increased essentially because of the
global economic challenges. The uncertainty in demand, which appeared at the
end of 2008, is expected to continue during the year of 2009. The international
recession has decreased Larox's customers' interest in investments and their
operational volumes when at the same time some customers are starting economic
measurements. some of the customers have postponed their decisions for
investments. this all causes further increase in competition. There are certain
branches of industry in Larox's clientele where less effect of the economic
crisis has been noticed, such as the food and pharmaceutical
industries. Similarly there is less effect in China and India.
Larox manages risks related to purchasing and manufacturing already at contract
level by tying raw material costs to materials cost index. Furthermore Larox
inspects and controls its subcontractors even more than before in accordance
with quality systems and by developing logistics. In addition, Larox aims to
expand its cooperation networks in order to avoid excessive dependencies on
key-suppliers. Larox improves also possibilities for product technology
transfers by creating and recording the procedures for more secured world-wide
technology transfers.
Due to the economic crisis, skilled personnel are now more readily available.
Larox attempts to tackle other personnel-related challenges by training the
personnel and by creating various types of incentive bonus and motivation
schemes.
The uncertainty about the financial situation of customer companies has
increased Larox's credit loss risk, too. Larox attempts to control these risks
by applying more suitable payment terms, by monitoring operations actively and
by reacting to payment delays more efficiently. On the initiative of some
customers Larox has negotiated and agreed on the postponement of some orders in
the order backlog to a later date than originally agreed.
The euro, U.S. dollar, Australian dollar and South African rand are Larox's main
invoicing currencies. Larox's principal buying currency is the euro. Larox
fights off currency risks by means of various protective measures. The
fluctuation of exchange rates of Larox's main currencies makes the management of
currency risks more difficult.
Larox manages its liquidity risk by means of efficient cash management. During
the review period, Larox increased amounts of available bank limits as well as
developed collection of receivables and internal reporting system. Larox's
liquidity has improved during this period.
Marginals of the credits of Larox have increased during the review period.
However, the average interest rate of the credits has decreased during the same
period as market interests rates have decreased.
Larox fights off the risk of damage by following various occupational health
and safety schemes and by preparing other strategies and plans for business
premises. According to Larox, traffic and other accidents and illnesses during
business trips pose the greatest risk of damage. During the review period there
was one fatal accident in Larox's subisidiary in South Africa, causing the death
of one employee of Larox's subcontractor. The causes of the accident are under
investigation. During the review period there have not been any other savage
personnel damages or accidents.
Further information about risks and risk management is presented in the Group's
Internet pages (www.larox.com)in the section of Corporate Governance.
OUTLOOK FOR THE REST OF THE YEAR
The instability in the world economy causes uncertainty in the demand situation.
Due to this outlook for the rest of the year is very difficult to predict and
the estimation includes more uncertainty than usual. Due to the non-recurring
costs resulting from adjustment measures Larox's result for the year 2009 will
be clearly negative.
Lappeenranta on 23rd October 2009
Larox Corporation
Board of Directors
For further information please contact
Mr. Topi Karppanen
President & CEO
Tel +358 (0) 207 687 210
Fax +358 (0) 207 687 277
E-mail topi.karppanen@larox.com
Internet www.larox.com
Distribution: NASDAQ OMX Helsinki Ltd, central media
www.larox.com
NOTES TO THE INTERIM REPORT
This interim report has been prepared in accordance with IFRS recognition and
measurement principles. The review is not prepared in accordance with all the
requirements of IAS 34 Interim Financial Reporting -standard. Larox has applied
the same accounting principles in this Annual Report as in Annual Report 2008.
In addition new requirements of IAS 1 and IFRS 8 standards have been applied
since 1 January 2009. The contents of the changes in standards and
interpretations are presented more detailed in Annual Report 2008. Other
reversed or new standards or interpretations have no material impact on the
financial statement of the Group.
The preparation of the financial statements in accordance with IFRS requires the
use of estimates and assumptions that affect the reported amounts of assets and
liabilities and the reported amounts of income and expenses during the reporting
period. The estimates are based on management's best knowledge of current events
and actions but actual results may differ from these estimates.
All below figures in the financial statements have been adjusted and therefore
the added sum of individual figures may differ from the presented added figure.
Annual reporting information included in this release is unaudited.
--------------------------------------------------------------------------------
| INCOME STATEMENT | | | | | |
--------------------------------------------------------------------------------
| 1 000 EUR | 7-9 | 7-9 | 1-9 | 1-9 | 1-12 |
| | /2009 | /2008 | /2009 | /2008 | /2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 31 947 | 58 804 | 116 007 | 143 916 | 207 995 |
--------------------------------------------------------------------------------
| Other operating income | 337 | 419 | 871 | 1 905 | 4 230 |
--------------------------------------------------------------------------------
| Materials | -15 043 | -33 235 | -56 585 | -74 779 | -107 971 |
--------------------------------------------------------------------------------
| External services | -1 676 | -2 293 | -5 845 | -6 345 | -11 146 |
--------------------------------------------------------------------------------
| Employee benefits | -12 083 | -9 491 | -31 011 | -26 379 | -36 360 |
| expense | | | | | |
--------------------------------------------------------------------------------
| Depreciation, | - 953 | -986 | -3 064 | -2 850 | -3 808 |
| amortization & | | | | | |
| impairment losses | | | | | |
--------------------------------------------------------------------------------
| Other operating | -6 785 | -7 694 | -21 035 | -23 758 | -36 322 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| OPERATING PROFIT | - 4 256 | 5 524 | -663 | 11 709 | 16 618 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial income | 249 | -98 | 831 | 471 | 655 |
--------------------------------------------------------------------------------
| Financial expenses | -391 | -877 | -1 441 | -2 450 | -3 778 |
--------------------------------------------------------------------------------
| Share of profit/loss | 23 | 243 | -45 | 501 | 462 |
| in associates | | | | | |
--------------------------------------------------------------------------------
| PROFIT/LOSS BEFORE TAX | -4 375 | 4 792 | -1 317 | 10 231 | 13 957 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Income tax expense | 1 091 | -1 475 | 87 | -3 037 | -3 935 |
--------------------------------------------------------------------------------
| PROFIT/LOSS FOR THE | -3 285 | 3 317 | -1 230 | 7 194 | 10 022 |
| PERIOD | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit for the period | -3 285 | 3 317 | -1 230 | 7 194 | 10 022 |
| attributable to equity | | | | | |
| holders of | | | | | |
| the parent company | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share | | | | | |
| attributable to equity | | | | | |
| holders of | | | | | |
| the parent company | | | | | |
--------------------------------------------------------------------------------
| EPS basic (EUR) | -0,35 | 0,35 | -0,13 | 0,77 | 1.07 |
--------------------------------------------------------------------------------
| EPS diluted (EUR) | -0,35 | 0,35 | -0,13 | 0,77 | 1.07 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| STATEMENT OF | 7-9 | 7-9 | 1-9 | 1-9 | 1-12 |
| COMPREHENSIVE | /2009 | /2008 | /2009 | /2008 | /2008 |
| INCOME | | | | | |
--------------------------------------------------------------------------------
| 1 000 EUR | | | | | |
--------------------------------------------------------------------------------
| Profit for the period | -3 285 | 3 317 | -1 230 | 7 194 | 10 022 |
--------------------------------------------------------------------------------
| OTHER COMPREHENSIVE | | | | | |
| INCOME | | | | | |
--------------------------------------------------------------------------------
| Gains/ losses | | | | | |
| recognized directly in | | | | | |
| equity | | | | | |
--------------------------------------------------------------------------------
| Cash flow hedges | 86 | -440 | 414 | -218 | -208 |
| excluding taxes,( | | | | | |
| 7-9/2009 112, 7-9/2008 | | | | | |
| 61, 1-9/2009 115, | | | | | |
| 1-9/2008 78 and | | | | | |
| 1-12/2008 -73) | | | | | |
--------------------------------------------------------------------------------
| Currency translation | -171 | 407 | 655 | -611 | -1 269 |
| differences | | | | | |
--------------------------------------------------------------------------------
| Total other | -85 | -33 | 1 069 | -829 | -1 477 |
| comprehensive | | | | | |
| income | | | | | |
--------------------------------------------------------------------------------
| TOTAL COMPREHENSIVE | -3 370 | 3 284 | -161 | 6 365 | 8 545 |
| INCOME FOR THE PERIOD | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive | -3 370 | 3 284 | -161 | 6 365 | 8 545 |
| income attributable to | | | | | |
| equity holders | | | | | |
| of the parent company | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| STATEMENT OF FINANCIAL POSITION, | | | |
| IFRS | | | |
--------------------------------------------------------------------------------
| 1 000 EUR | 30.9.2009 | 30.9.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ASSETS | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NON-CURRENT ASSETS | | | |
--------------------------------------------------------------------------------
| Intangible asssets | 17 862 | 17 917 | 18 998 |
--------------------------------------------------------------------------------
| Goodwill | 3 124 | 2 778 | 2 843 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 12 064 | 9 141 | 11 382 |
--------------------------------------------------------------------------------
| Investments in associates | 1 542 | 1 754 | 1 723 |
--------------------------------------------------------------------------------
| Available-for-sale investments | 23 | 34 | 23 |
--------------------------------------------------------------------------------
| Receivables | 0 | 4 332 | |
--------------------------------------------------------------------------------
| Deferred tax asset | 4 901 | 5 281 | 5 063 |
--------------------------------------------------------------------------------
| TOTAL NON-CURRENT ASSETS | 39 516 | 41 237 | 40 031 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENT ASSET | | | |
--------------------------------------------------------------------------------
| Inventories | 22 985 | 28 742 | 28 191 |
--------------------------------------------------------------------------------
| Trade receivables and other | 40 888 | 32 946 | 46 555 |
| receivables | | | |
--------------------------------------------------------------------------------
| Current tax assets | 840 | 1 027 | 1 701 |
--------------------------------------------------------------------------------
| Cash and bank | 2 303 | 3 841 | 1 661 |
--------------------------------------------------------------------------------
| TOTAL CURRENT ASSET | 67 015 | 66 556 | 78 108 |
--------------------------------------------------------------------------------
| TOTAL ASSET | 106 531 | 107 793 | 118 139 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | | | |
--------------------------------------------------------------------------------
| Share capital | 5 629 | 5 629 | 5 629 |
--------------------------------------------------------------------------------
| Share premium account | 5 777 | 5 777 | 5 777 |
--------------------------------------------------------------------------------
| Other reserves | 205 | -218 | -208 |
--------------------------------------------------------------------------------
| Translation differences | -442 | -131 | -205 |
--------------------------------------------------------------------------------
| Retained earnings | 21 629 | 22 627 | 24 777 |
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY | 32 799 | 33 684 | 35 770 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NON-CURRENT LIABILITIES | | | |
--------------------------------------------------------------------------------
| Deferred tax liability | 1 566 | 3 307 | 4 111 |
--------------------------------------------------------------------------------
| Long term financial liabilities | 14 309 | 13 982 | 13 124 |
--------------------------------------------------------------------------------
| Employee benefit obligations | 624 | 573 | 594 |
--------------------------------------------------------------------------------
| Non-current provisions | 1 348 | 1 102 | 1 843 |
--------------------------------------------------------------------------------
| TOTAL NON-CURRENT LIABILITIES | 17 848 | 18 965 | 19 672 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENT LIABILITIES | | | |
--------------------------------------------------------------------------------
| Short term financial liabilities | 27 124 | 20 359 | 25 144 |
--------------------------------------------------------------------------------
| Trade payables and other payables | 19 972 | 31 986 | 35 893 |
--------------------------------------------------------------------------------
| Current tax liabilities | 1 806 | 632 | 550 |
--------------------------------------------------------------------------------
| Current provisions | 6 984 | 2 166 | 1 110 |
--------------------------------------------------------------------------------
| TOTAL CURRENT LIABILITIES | 55 885 | 55 143 | 62 697 |
--------------------------------------------------------------------------------
| TOTAL EQUITY AND LIABILITIES | 106 531 | 107 793 | 118 139 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| STATEMENT OF CASH FLOW, IFRS | | | |
--------------------------------------------------------------------------------
| 1 000 EUR | 1-9/2009 | 1-9/2008 | 1-12/2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net profit/loss | -1 230 | 7 194 | 10 022 |
--------------------------------------------------------------------------------
| Adjustments to the net | 3 632 | 7 365 | 10 400 |
| profit/loss of the period | | | |
--------------------------------------------------------------------------------
| Change in working capital | 1 749 | 5 200 | -2 999 |
--------------------------------------------------------------------------------
| Interest paid | -1 035 | -1 444 | -1 848 |
--------------------------------------------------------------------------------
| Interest income received | 265 | 88 | 78 |
--------------------------------------------------------------------------------
| Other financing items | -466 | 175 | 253 |
--------------------------------------------------------------------------------
| Income taxes paid | -627 | -2 154 | -5 058 |
--------------------------------------------------------------------------------
| Net cash from operating | 2 288 | 16 425 | 10 848 |
| activities | | | |
--------------------------------------------------------------------------------
| Net cash used in investment | -2 144 | -6 084 | -6 228 |
| activities | | | |
--------------------------------------------------------------------------------
| Increase in loans | 17 498 | 19 370 | 27 356 |
--------------------------------------------------------------------------------
| Decrease in loans | -14 266 | -21 831 | -26 129 |
--------------------------------------------------------------------------------
| Repayment of finance lease | -68 | -80 | -88 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Dividends paid | -2 814 | -5 629 | -5 629 |
--------------------------------------------------------------------------------
| Net cash used in financing | 350 | -8 170 | -4 490 |
| activities | | | |
--------------------------------------------------------------------------------
| Change in cash and cash | 493 | 2 172 | 131 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Operating balance of cash and | 1 661 | 1 812 | 1 812 |
| cash equivalents | | | |
--------------------------------------------------------------------------------
| Effect of the foreign exchange | 149 | -143 | -282 |
| rates | | | |
--------------------------------------------------------------------------------
| Closing balance of cash and cash | 2 303 | 3 841 | 1 661 |
| equivalents | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CHANGE IN | | | | | | |
| SHAREHOLDERS' | | | | | | |
| EQUITY | | | | | | |
--------------------------------------------------------------------------------
| Equity belonging to parent company's shareholders |
--------------------------------------------------------------------------------
| 1-9/2008 | | | |
--------------------------------------------------------------------------------
| 1 000 EUR | Share | Share | Hedgi | Trans | Retain | Total |
| | cap | issue | ng | lation | ed | |
| | ital | premiu | re | diff. | ear | |
| | | m | s. | | nings | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY |
--------------------------------------------------------------------------------
| 1.JAN 2008 |
--------------------------------------------------------------------------------
| | 5 629 | 5 777 | | -127 | 21 566 | 32 845 |
--------------------------------------------------------------------------------
| Dividend | | | | | -5 629 | -5 629 |
| distribution | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | | | | 103 | 103 |
| payments | | | | | | |
--------------------------------------------------------------------------------
| Total | | | -218 | -4 | 6 587 | 6 365 |
| comprehensive | | | | | | |
| income for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 5 629 | 5 777 | -218 | -131 | 22 627 | 33 684 |
| EQUITY 30 SEP | | | | | | |
| 2008 | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Equity belonging to parent company's shareholders |
--------------------------------------------------------------------------------
| 1-9/2009 | | |
--------------------------------------------------------------------------------
| 1 000 EUR | Share | Share | Hedgi | Trans | Retain | Total |
| | cap | issue | ng | lati | ed | |
| | ital | premiu | re | on | ear | |
| | | m | s. | diff. | ni | |
| | | | | | ngs | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY |
--------------------------------------------------------------------------------
| 1.JAN 2009 |
--------------------------------------------------------------------------------
| | 5 629 | 5 777 | -208 | -205 | 24 777 | 35 770 |
--------------------------------------------------------------------------------
| Dividend | | | | | -2 814 | -2 814 |
| distribution | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | | | | 4 | 4 |
| payments | | | | | | |
--------------------------------------------------------------------------------
| Total | | | 414 | -238 | -337 | -161 |
| comprehensive | | | | | | |
| income for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY |
--------------------------------------------------------------------------------
| 30 SEP 2009 |
--------------------------------------------------------------------------------
| | 5 629 | 5 777 | 205 | -442 | 21 629 | 32 799 |
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KEY RATIOS OF LAROX GROUP
--------------------------------------------------------------------------------
| 1 000 EUR | 1-9/2009 | 1-9/2008 | 1-12/2008 |
| | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| New orders | 78 723 | 158 982 | 184 799 |
--------------------------------------------------------------------------------
| Group order backlog, end of the | 36 582 | 110 087 | 72 006 |
| period | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 116 007 | 143 916 | 207 995 |
--------------------------------------------------------------------------------
| Operating profit | -663 | 11 709 | 16 618 |
--------------------------------------------------------------------------------
| % of net sales | -0,6 | 8,1 | 8.0 |
--------------------------------------------------------------------------------
| Net financing costs | 654 | 1 479 | 2 661 |
--------------------------------------------------------------------------------
| % of net sales | 0,6 | 1,0 | 1.3 |
--------------------------------------------------------------------------------
| Result before taxes | -1 317 | 10 231 | 13 957 |
--------------------------------------------------------------------------------
| Result for the period | -1 230 | 7 194 | 10 022 |
--------------------------------------------------------------------------------
| EPS basic and diluted (EUR) | -0,13 | 0,77 | 1.07 |
--------------------------------------------------------------------------------
| Investments | 2 430 | 6 207 | 7 402 |
--------------------------------------------------------------------------------
| Shareholders' equity per share at the | 3,48 | 3,59 | 3.81 |
| end of the period (EUR) | | | |
--------------------------------------------------------------------------------
| Equity ration % | 31,3 | 32,6 | 32.3 |
--------------------------------------------------------------------------------
| Contingent liabilities (EUR million) | 43,7 | 28,0 | 44.2 |
--------------------------------------------------------------------------------
| Trading price at the end of period, | 7,00 | 8,35 | 4.60 |
| (EUR) | | | |
--------------------------------------------------------------------------------
| Market capitalization at the end of | | | |
| period, | | | |
--------------------------------------------------------------------------------
| EUR million *) | 66,0 | 78,3 | 43.2 |
--------------------------------------------------------------------------------
| Personnel, average | 593 | 525 | 562 |
--------------------------------------------------------------------------------
| Personnel at the end of the period | 569 | 557 | 593 |
--------------------------------------------------------------------------------
| Net sales/employer | 196 | 274 | 370 |
--------------------------------------------------------------------------------
*) The price of the A share is based on the B share's last trading rate of the
reporting period (weighted average).
KEY FIGURES BY QUARTERS
--------------------------------------------------------------------------------
| | 2009 | 2009 | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| 1 000 EUR | 7-9 | 4-6 | 1-3 | 10-12 | 7-9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| New orders | 27 049 | 23 694 | 27 982 | 25 817 | 53 759 |
--------------------------------------------------------------------------------
| Group order backlog | 36 582 | 40 535 | 57 029 | 72 006 | 110 087 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| net sales | 31 947 | 40 768 | 43 292 | 64 079 | 58 804 |
--------------------------------------------------------------------------------
| Operating profit | -4 256 | 490 | 3 103 | 4 908 | 5 524 |
--------------------------------------------------------------------------------
| % of net sales | -13,3 | 1.2 | 7.2 | 7.7 | 9.4 |
--------------------------------------------------------------------------------
| Net financing costs | 120 | 174 | 360 | 1 182 | 732 |
--------------------------------------------------------------------------------
| % of net sales | 0,4 | 0.4 | 0.8 | 1.8 | 1.2 |
--------------------------------------------------------------------------------
| Result before taxes | -4 375 | 315 | 2 743 | 3 726 | 4 792 |
--------------------------------------------------------------------------------
| Result for the | -3 285 | 135 | 1 919 | 2 828 | 3 317 |
| quarter | | | | | |
--------------------------------------------------------------------------------
| EPS basic and diluted | 0.01 | 0.20 | 0.30 | 0.35 |
| -0.35 | | | | |
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DIVIDEND PAYMENT
Based on the resolution of the annual general meeting of shareholders held
on 26 March 2009 a dividend of EUR 0.30 per share was paid on 20 May 2009; a
total of EUR 2.814.480.
INVESTMENTS
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| Property, plant and equipment | | | |
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| | 30.9.2009 | 30.9.2008 | 31.12.2008 |
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| Acquisition cost | 32 762 | 29 520 | 29 520 |
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| Translation differences | 40 | -76 | -349 |
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| Additions | 1 768 | 896 | 1 226 |
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| Acquisition of subsidiary | 0 | 0 | 2 938 |
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| Disposals | 0 | 0 | -33 |
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| Acquisition cost | 34 570 | 30 340 | 32 762 |
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| Cumulative depreciations | -21 380 | -20 263 | -20 263 |
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| Translation differences | 39 | 67 | 279 |
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| Depreciation for the period | -1 165 | -1 003 | -1 394 |
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| Cumul depr, end of period | -22 506 | -21 199 | -21 380 |
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| Carrying value, end of period | 12 064 | 9 141 | 11 382 |
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| Intangible assets (excluding | | | |
| goodwill) | | | |
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| | 30.9.2009 | 30.9.2008 | 31.12.2008 |
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| Acquisition cost | 32 488 | 29 858 | 29 858 |
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| Translation differences | -21 | 7 | 18 |
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| Additions | 763 | 968 | 1 763 |
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| Acquisition of subsidiary | 0 | 0 | 850 |
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| Disposals | 0 | 0 | 0 |
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| Acquisit. cost, end of period | 33 230 | 30 833 | 32 488 |
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| Cumulative depreciations | -13 490 | -11 063 | -11 062 |
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| Translation differences | 21 | -5 | -14 |
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| Depreciation for the period | -1 899 | -1 848 | -2 414 |
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| Cumul depr, end of period | -15 368 | -12 916 | -13 490 |
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| Carrying value, end of period | 17 862 | 17 917 | 18 998 |
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SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker who is responsible for
allocating resources and assessing performance of the segment. The chief
operating decision maker of Larox Group has been identified as the CEO of Larox
Group, currently Mr. Topi Karppanen.
Business operations of Larox Group are managed as one operational entity, solid
liquid separation. The segment is based on customer life-cycle model.
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| Solid and liquid separation | | | |
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| 1 000 EUR | 1.1.- | 1.1.- | 1.1.- |
| | 30.9.2009 | 30.9.2008 | 31.12.2008 |
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| | | | |
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| Net sales | 115 864 | 144 305 | 207 491 |
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| Net sales of Aftermarket Sales | 55 998 | 73 210 | 95 947 |
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| Share of Net Sales of | 48 % | 51 % | 46 % |
| Aftermarket Sales % from Total | | | |
| Net Sales | | | |
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| Other operating income | 679 | 2 103 | 2 259 |
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| Materials | -56 499 | -75 393 | -107 073 |
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| External services | -6 231 | -6 409 | -11 146 |
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| Employee benefits expenses | -29 334 | -24 449 | -34 017 |
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| Other operating expenses | -22 586 | -25 506 | -36 775 |
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| Depreciations | -3 159 | -2 979 | -4 116 |
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| Operating profit | -1 267 | 11 671 | 16 623 |
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| | | | |
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| Financing | -686 | -1 479 | -2 523 |
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| | | | |
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| Profit / loss before taxes | -1 953 | 10 192 | 14 100 |
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| Operating profit % | -1,1 % | 8,1 % | 8.0 % |
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| 1 000 EUR | 1.7.-30.9. | 1.7.-30.9. | 1.1.-31.12. |
| | 2009 | 2008 | 2008 |
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| | | | |
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| Net sales | 31 779 | 59 529 | 207 491 |
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| Net sales of Aftermarket Sales | 19 398 | 28 708 | 95 947 |
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| Share of Net Sales of | 61 % | 48 % | 46 % |
| Aftermarket Sales % from Total | | | |
| Net Sales | | | |
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| Other operating income | 142 | 727 | 2 259 |
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| Materials | -14 508 | -34 485 | -107 073 |
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| External services | -2 138 | -2 254 | -11 146 |
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| Employee benefits expenses | -11 501 | -9 162 | -34 017 |
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| Other operating expenses | -7 400 | -8 370 | -36 775 |
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| Depreciations | -1 035 | -1 037 | -4 116 |
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| Operating profit | -4 662 | 4 947 | 16 623 |
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| | | | |
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| Financing | -98 | -901 | -2 523 |
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| | | | |
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| Profit / loss before taxes | -4 760 | 4 046 | 14 100 |
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| Operating profit % | -14,7 % | 8,3 % | 8,0 % |
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RECONCILIATIONS BETWEEN SEGMENT INFORMATION AND IFRS FIGURES ARE PRESENTED
BELOW.
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| 1.1.-30.9.2009 | Segment | Non | IFRS |
| | inform | allocated | |
| | ation | amount | |
| | | s *) | |
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| | | | |
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| Net sales | 115 864 | 142 | 116 007 |
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| Operating profit | -1 267 | 604 | -663 |
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| Profit / loss before | -1 953 | 636 | -1 317 |
| taxes | | | |
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| 1.7.-30.9.2009 | Segment | Non | IFRS |
| | inform | allocated | |
| | ation | amount | |
| | | s *) | |
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| | | | |
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| Net sales | 31 779 | 167 | 31 947 |
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| Operating profit | -4 662 | 406 | -4 256 |
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| Profit / loss before | -4 760 | 384 | -4 375 |
| taxes | | | |
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| 1.1.-30.9.2008 | Segment | Non | IFRS |
| | inform | allocated | |
| | ation | amount | |
| | | s *) | |
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| | | | |
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| Net sales | 144 305 | -389 | 143 916 |
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| Operating profit | 11 671 | 38 | 11 709 |
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| Profit / loss before | 10 192 | 39 | 10 231 |
| taxes | | | |
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| 1.7.-30.9.2008 | Segment | Non | IFRS |
| | inform | allocated | |
| | ation | amount | |
| | | s *) | |
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| | | | |
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| Net sales | 59 529 | -725 | 58 804 |
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| Operating profit | 4 947 | 576 | 5 524 |
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| Profit / loss before | 4 046 | 746 | 4 792 |
| taxes | | | |
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| 1.1.-31.12.2008 | Segment | Non | IFRS |
| | inform | allocated | |
| | ation | amount | |
| | | s *) | |
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| | | | |
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| Net sales | 207 491 | 504 | 207 995 |
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| Operating profit | 16 623 | -5 | 16 618 |
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| Profit / loss before | 14 100 | -143 | 13 957 |
| taxes | | | |
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*) Unallocated amounts consist mainly of financial lease, hedging accounting and
foreign exchange rate differences. Internal reporting is not calculated
according to IAS 17, IAS 32 or IAS 39 standards in above reported amounts.
COMMITMENTS AND CONTINGENCIES
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| Loans secured by real estate and corporate | | |
| mortgages | | |
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| 1 000 EUR | 30.9.2009 | 30.9.2008 | 31.12.2008 |
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| Pension loans | | | |
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| Loans from financial institutions | 40 331 | 34 115 | 38 049 |
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| Other loans | 0 | | 0 |
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| Total | 40 331 | 34 115 | 38 049 |
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| Real estate mortgages | 6 560 | 6 560 | 6 560 |
| | | | |
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| Corporate mortgages, general | 3 936 | 3 936 | 3 936 |
| pledging | | | |
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| Corporate mortgages, specific | 9 062 | 9 062 | 9 062 |
| pledging | | | |
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| Total | 19 558 | 19 558 | 19 558 |
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| Guarantees for others | | | |
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| Pledged securities *) | 13 511 | 6 476 | 13 511 |
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| Others | 161 | 157 | 161 |
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| Total | 13 672 | 6 633 | 13 672 |
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| *) Book value of secured shares | | |
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| Other liabilities | | | |
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| Operating lease liabilities 1 000 | 1 028 | 919 | 1 094 |
| EUR | | | |
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| Lease liabilities 1 000 EUR | 9 451 | 849 | 9 889 |
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FAIR AND NOMINAL VALUES OF DERIVATIVE INSTRUMENTS
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| 1 000 EUR | 30.9.2009 | 30.9.2008 | 31.12.2008 |
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| Currency derivatives: | | | |
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| Currency options | 4 117 | 0 | 0 |
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| Forward contracts | 7 295 | 10 496 | 7 033 |
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| Fair value | 64 | -450 | -402 |
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| Nominal value | 11 412 | 10 496 | 7 033 |
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Related party transactions
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| 1 000 EUR | 1.1.-30.9.2009 | 1.1.-30.9.2008|1.1.-31.12.2008 |
| | | | |
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| Transactions with | | | |
| associated | | | |
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| Companies | | | |
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| Sales of goods and | 10 | 5 | 15 |
| services | | | |
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| Purchases of goods and | 2 111 | 3 175 | 2 736 |
| services | | | |
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| Other transactions with | | | |
| related | | | |
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| Parties | | | |
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| Purchases of services | 30 | 15 | 20 |
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| Balances with associated | | | |
| companies | | | |
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| Trade receivables | 2 | 2 | 16 |
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| Other receivables | 0 | 0 | 0 |
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| Trade payables | 366 | 488 | 236 |
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CALCULATION OF KEY FIGURES
Equity ratio, % =
Shareholders' equity
--------------------------------- x 100
Total assets - advances received
Earnings per share =
Net profit
---------------------------------
Adjusted average number of shares
during the period
Market capitalization at the end of the period =
Number of shares at the end of the period x trading price at the end of the
period weighted by the number of shares traded
Larox develops, designs and manufactures industrial filters and is a leading
technology company in its field. Larox is a full service solution provider in
filtration for separating solids from liquids. It supplies comprehensive
aftermarket services throughout the lifespan of the Larox solution. Companies
world-wide in mining and metallurgy, chemical processing and related industries
benefit from the Larox technologies. Larox operates in over 40 countries and has
over 600 employees. Larox has production facilities in Finland and in China, and
the Group is headquartered in Lappeenranta, Finland. Net sales in 2008 totaled
208.0 million euros, of which more than 93 % were generated by exports and the
company's foreign operations.
