Comments by the CEO Within 12 months 2009, 82 apartments or plots were sold in Arco Vara projects, thereby 41 of them in the fourth quarter. In Latvia, 12 Bišumuiža apartments and 11 residential plots in the project near the Mazais Baltezers lake. In Estonia, 44 Kodukolle apartments and 16 Merivälja apartments were sold. In the Boulevard Residence Madrid project in Sofia, a 30-year rental agreement was concluded with the Austrian supermarket chain Billa, by which the supermarket will rent approx. 900 m2 of the ground floor sales space of the building. A long-term lease agreement was concluded with a financial intermediary company that will lease 4 700 m2 office space. The strategy of Arco Vara development division is to finish the unfinished apartments in the Bišumuiža-1 project in Riga, the apartments and business areas in the Boulevard Residence Madrid and Manastirski projects in Sofia with more favourable construction prices. In autumn, the construction of the Kodukolde and Merivälja projects in Tallinn was completed. The finished residential areas help to release invested equity and reduce the liabilities of the Group. In order to stay in competition and accelerate sales pace, we were forced to reduce plot and apartment prices in all Arco Vara projects in the first half-year. The restructuring of the service division has considerably reduced its administration costs, and the operating loss of the quarter has reduced to 1.0 million kroons (0.063 million euros). Reduction of the number of employees has stopped and the staff makes up 47% on year-over-year basis. Within 12 months, the division has sold most of its real estate objects acquired for short-term investments. This has helped the division to manage by itself. The work organisation of some smaller offices outside the capital city was changed by giving up the classical office-based work organisation and applying the home office system by maintaining our full service selection and network at the same time. In other offices, more cost effective work organisation solutions are being implemented in cooperation with employees. The aim of the service division is to continue implementing the partially applied and in the current market situation justified work organisation also in foreign markets. This allows increasing service provision with unlimited means in these countries, with a future focus on Estonia, Latvia and Bulgaria. In the construction division, new agreements in the amount of 171 million kroons (10.9 million euros) were concluded during the twelve months, thereof 34.0 millions kroons (2.2 million euros) in the 4th quarter. After the balance sheet date, Arco Ehitus OÜ has been announced as best tenderer either alone or in a consortium in tender with a total value of 129.9 million kroons (8.3 million euros). In summary: The overall result of 12 months was most influenced by fair value adjustments. The gross profit without revaluation was 49.7 million kroons (3.2 million euros), whereof in the fourth quarter 14.3 million kroons (0.9 million euros). The net profit without revaluation of inventory, property investment, financial assets, and goodwill, and without the loss of transfer of holdings and assets amounted to -58.7 million kroons (-3.7 million euros), whereof the net profit of the fourth quarter made up -23.2 million kroons (-1.4 million euros). The savings in fixed costs on the year-over-year basis have exceeded the original expectations of the management two times. The Group considers the relation between construction prices and sales perspective good enough to start the last stage of the Kodukolde (96 apartments) and Tivoli (approx. 150 apartments) developments. The Group is carrying on negotiations with potential partners and banks in order to find a favourable financing structure for both projects. In order to improve liquidity, the Group has, on a current basis, sold smaller property investments and holdings in three joint ventures where the working capital was not under the full control of the Group. By selling the holdings, the company improved its liquidity position by 55 million kroons (3.5 million euros). Due to adapting the Arco Vara AS management structure to the reduced operations and cost saving policy, the number of Members of the Board was reduced and two Members of the Board were removed in the 3rd quarter. As Member of the Board of Arco Vara, Lembit Tampere continues his work. MAIN INDICATORS OF THE 12 MONTHS Revenue and other income for the twelve months totalled 541.6 million kroons (34.6 million euros), 21.5% down year-over-year. Operating loss amounted to 271.6 million kroons (17.4 million euros), which is 74.1% less than last year Net loss amounted toto 324.4 million kroons (20.7 million euros), 72.0% less than last year Equity ratio was 27.8% (12 months 2008: 36.1%). ROE was negative (12 months 2008: negative). ROIC was negative (12 months 2008: negative). In the construction division, new agreements in the amount of 171.0 million kroons (10.9 million euros) were concluded, 12 months 2008: 299.0 million kroons (19.1 million euros). At the end of the reporting period, the construction business order backlog was 80 million kroons (5.1 million euros), 12 months 2008: 185.0 million kroons (11.8 million euros). Within 12 months, 82 apartments or plots were sold in Arco Vara projects (12 months 2008: 98). -------------------------------------------------------------------------------- | EEK | EUR | -------------------------------------------------------------------------------- | | 12 | 12 | Q4 | Q4 2008 | 12 | 12 | Q4 | Q4 | | | mont | mont | 2009 | | month | month | 2009 | 2008 | | | hs | hs | | | s | s | | | | | 2009 | 2008 | | | 2009 | 2008 | | | -------------------------------------------------------------------------------- | In millions | | | | | | | | | -------------------------------------------------------------------------------- | Revenue and | 541, | 690, | 156, | 150,4 | 34,6 | 44,1 | 10,0 | 9,6 | | other | 6 | 4 | 6 | | | | | | | income | | | | | | | | | -------------------------------------------------------------------------------- | EBIT | -271 | -1 | -43, | -943,0 | -17,4 | -67,1 | -2,8 | -60,3 | | | ,6 | 049, | 4 | | | | | | | | | 7 | | | | | | | -------------------------------------------------------------------------------- | incl. | -232 | -993 | -25, | -931,6 | -14,8 | -63,5 | -1,6 | -59,5 | | revaluation | ,1 | ,9 | 7 | | | | | | | of | | | | | | | | | | investment | | | | | | | | | | property | | | | | | | | | | and | | | | | | | | | | inventory | | | | | | | | | -------------------------------------------------------------------------------- | Profit / | -325 | -1 | -96, | -1 059,6 | -20,8 | -73,6 | -6,2 | -67,7 | | loss before | ,3 | 151, | 6 | | | | | | | tax | | 3 | | | | | | | -------------------------------------------------------------------------------- | incl. | -3,6 | -41, | 1,2 | -4,7 | -0,2 | -2,6 | 0,1 | -0,3 | | profit or | | 3 | | | | | | | | loss from | | | | | | | | | | transfer of | | | | | | | | | | financial | | | | | | | | | | assets | | | | | | | | | -------------------------------------------------------------------------------- | Net profit | -324 | -1 | -94, | -1 057,6 | -20,7 | -74,1 | -6,1 | -67,6 | | / loss | ,4 | 160, | 9 | | | | | | | | | 1 | | | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | EPS 1 (in | -3,4 | -12, | -1,0 | -11,0 | -0,22 | -0,78 | -0,06 | -0,71 | | kroons and | 2 | 18 | 0 | | | | | | | euros) | | | | | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | Total | 1 | 1 | | | 88,1 | 125,9 | | | | assets at | 379, | 970, | | | | | | | | period end | 2 | 6 | | | | | | | -------------------------------------------------------------------------------- | Invested | 1 | 1 | | | 76,0 | 112,5 | | | | capital at | 188, | 760, | | | | | | | | period end | 7 | 7 | | | | | | | -------------------------------------------------------------------------------- | Net loans | 734, | 842, | | | 46,9 | 53,8 | | | | at period | 4 | 0 | | | | | | | | end | | | | | | | | | -------------------------------------------------------------------------------- | Equity at | 384, | 709, | | | 24,5 | 45,4 | | | | period end | 1 | 7 | | | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | Average | 0,9 | 2,5 | | | 0,9 | 2,5 | | | | loan term | | | | | | | | | | (in years) | | | | | | | | | -------------------------------------------------------------------------------- | Average | 5,3% | 7,0% | | | 5,3% | 7,0% | | | | interest | | | | | | | | | | rate of | | | | | | | | | | loans (per | | | | | | | | | | year) | | | | | | | | | -------------------------------------------------------------------------------- | ROIC | neg | Neg | | | neg | neg | | | | (rolling 4 | | | | | | | | | | quarters) | | | | | | | | | -------------------------------------------------------------------------------- | ROE | neg | Neg | | | neg | neg | | | | (rolling 4 | | | | | | | | | | quarters) | | | | | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | Number of | 163 | 396 | | | 163 | 396 | | | | staff at | | | | | | | | | | period end | | | | | | | | | -------------------------------------------------------------------------------- REVENUE AND PROFIT The overall result of 12 months was most influenced by fair value adjustments. In the 4th quarter, the loss related to the transfer of holdings in three substantial joint ventures was reflected as fair value adjustment. As a result of the transaction, investment property was written down by 134.4 million kroons (8.6 million euros) and financial assets by 4.5 million kroons (0.3 million euros) as of end of 9 months The total net adjustments and losses on sale within 12 months amounted to 265.7 million kroons (-17.0 million euros). Main cost cuttings have been made and striving towards reduced costs has become a routine practice in all of our business units: we are aiming at saving fixed costs additionally by 15.0 million kroons (1.0 million euros) on an annual basis. The main focus is now set on increasing the turnover, completing the Madrid project, and improving the liquidity through the sales of projects and stock. In the fourth quarter, the claim against AS Ühendatud Kapital with the new book value of 32.6 million kroons (2.1 million euros) was additionally discounted. Construction division EBIT in the 4th quarter without asset and goodwill write down was 1.6 million kroons (0.1 million euros). Service division EBIT in the 4th quarter without asset write down was -1.0 million kroons (-0.1 million euros). The biggest write up of the year was made in Latvia where the right of superficies under inventory was reclassified to investment property as in the near future, no development activities are planned and buyers for the development projects are searched for. It is a residential plot project with an area of 86 ha, located at the Mazais Baltezers lake near Riga. According to the detailed plan, a total of 189 plots for houses with a total gross enclosed area of 172 380 m2 can be built.In the fourth quarter, the claim against AS Ühendatud Kapital with the new book value of 32.6 million kroons (2.1 million euros) was additionally discounted. -------------------------------------------------------------------------------- | EEK | EUR | -------------------------------------------------------------------------------- | | 12 | 12 | Q4 | Q4 | 12 | 12 | Q4 | Q4 | | | month | month | 2009 | 2008 | months | months | 2009 | 2008 | | | s | s | | | 2009 | 2008 | | | | | 2009 | 2008 | | | | | | | -------------------------------------------------------------------------------- | In | | | | | | | | | | millions | | | | | | | | | -------------------------------------------------------------------------------- | Revenue | | | | | | | | | | and | | | | | | | | | | other | | | | | | | | | | income | | | | | | | | | -------------------------------------------------------------------------------- | Services | 38,0 | 104,7 | 9,4 | 14,2 | 2,4 | 6,7 | 0,6 | 0,9 | -------------------------------------------------------------------------------- | Developm | 266,6 | 246,4 | 48,2 | 50,7 | 17,0 | 15,7 | 3,1 | 3,2 | | ent | | | | | | | | | -------------------------------------------------------------------------------- | Construc | 277,2 | 416,8 | 102,3 | 93,5 | 17,7 | 26,6 | 6,5 | 6,0 | | tion | | | | | | | | | -------------------------------------------------------------------------------- | Eliminat | -40,3 | -77,5 | -3,2 | -8,0 | -2,6 | -5,0 | -0,2 | -0,5 | | ions | | | | | | | | | -------------------------------------------------------------------------------- | Total | 541,5 | 690,4 | 156,7 | 150,4 | 34,6 | 44,1 | 10,0 | 9,6 | | revenue | | | | | | | | | | and | | | | | | | | | | other | | | | | | | | | | income | | | | | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | EBIT | | | | | | | | | -------------------------------------------------------------------------------- | Services | -16,6 | -47,9 | -7,1 | -17,2 | -1,1 | -3,1 | -0,5 | -1,1 | -------------------------------------------------------------------------------- | Developm | -260, | -985, | -87,3 | -917, | -16,6 | -63,0 | -5,6 | -58,6 | | ent | 1 | 1 | | 2 | | | | | -------------------------------------------------------------------------------- | Construc | -10,1 | 6,3 | -7,3 | -1,4 | -0,6 | 0,4 | -0,5 | -0,1 | | tion | | | | | | | | | -------------------------------------------------------------------------------- | Eliminat | 33,7 | -2,6 | 60,0 | -2,4 | 2,2 | -0,2 | 3,8 | -0,2 | | ions | | | | | | | | | -------------------------------------------------------------------------------- | Unalloca | -18,5 | -20,4 | -1,7 | -4,8 | -1,3 | -1,1 | 0,0 | -0,3 | | ted | | | | | | | | | | expenses | | | | | | | | | -------------------------------------------------------------------------------- | Total | -271, | -1 | -43,4 | -943, | -17,4 | -67,0 | -2,8 | -60,3 | | EBIT | 6 | 049,7 | | 0 | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | Interest | -33,5 | 5,1 | -9,5 | -17,5 | -2,1 | 0,3 | -0,6 | -1,1 | | income | | | | | | | | | | and | | | | | | | | | | expense | | | | | | | | | -------------------------------------------------------------------------------- | Net | -20,2 | -106, | -43,7 | -99,1 | -1,3 | -6,8 | -2,8 | -6,3 | | other | | 7 | | | | | | | | financia | | | | | | | | | | l items | | | | | | | | | -------------------------------------------------------------------------------- | Income | 0,9 | -8,8 | 1,7 | 2,0 | 0,1 | -0,6 | 0,1 | 0,1 | | tax | | | | | | | | | | expense | | | | | | | | | -------------------------------------------------------------------------------- | Net | -324, | -1 | -94,9 | -1 | -20,7 | -74,1 | -6,1 | -67,6 | | profit / | 4 | 160,1 | | 057,6 | | | | | | loss | | | | | | | | | -------------------------------------------------------------------------------- CASH FLOWS -------------------------------------------------------------------------------- | EEK | EUR | -------------------------------------------------------------------------------- | | 12 | 12 | Q4 | Q4 | 12 | 12 | Q4 | Q4 | | | month | mont | 2009 | 2008 | month | month | 2009 | 2008 | | | s | hs | | | s | s | | | | | 2009 | 2008 | | | 2009 | 2008 | | | -------------------------------------------------------------------------------- | In millions | | | | | | | | | -------------------------------------------------------------------------------- | Cash flows | -23,6 | -127 | 26,2 | -26,2 | -1,5 | -8,2 | 1,7 | -1,7 | | from | | ,6 | | | | | | | | operating | | | | | | | | | | activities | | | | | | | | | -------------------------------------------------------------------------------- | Cash flows | 95,5 | -62, | 50,0 | 66,1 | 6,1 | -4,0 | 3,2 | 4,2 | | from | | 6 | | | | | | | | investing | | | | | | | | | | activities | | | | | | | | | -------------------------------------------------------------------------------- | Cash flows | -173, | -402 | -68,0 | -78,8 | -11,1 | -25,7 | -4,3 | -5,0 | | from | 4 | ,2 | | | | | | | | financing | | | | | | | | | | activities | | | | | | | | | -------------------------------------------------------------------------------- | Net cash | -101, | -592 | 8,2 | -38,9 | -6,5 | -37,9 | 0,5 | -2,5 | | flow | 5 | ,4 | | | | | | | -------------------------------------------------------------------------------- | | | | | | | | | | -------------------------------------------------------------------------------- | Cash and | 172,6 | 765, | 62,6 | 211,5 | 11,0 | 48,9 | 4,0 | 13,5 | | cash | | 0 | | | | | | | | equivalents | | | | | | | | | | at | | | | | | | | | | beginning | | | | | | | | | | of period | | | | | | | | | -------------------------------------------------------------------------------- | Effect of | 0,3 | 0,0 | 0,6 | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 | | exchange | | | | | | | | | | rate | | | | | | | | | | fluctuation | | | | | | | | | | s | | | | | | | | | -------------------------------------------------------------------------------- | Cash and | 71,4 | 172, | 71,4 | 172,6 | 4,5 | 11,0 | 4,5 | 11,0 | | cash | | 6 | | | | | | | | equivalents | | | | | | | | | | at end of | | | | | | | | | | period | | | | | | | | | -------------------------------------------------------------------------------- In January 2009, 40 million kroons from the loan principals related to the Tivoli and Laeva projects were paid back on an extraordinary basis, by releasing the Group from the obligation to keep liquid assets in an amount of 150 million kroons (9.6 million euros) in the SEB bank. On an extraordinary basis, smaller loans and principal amounts have been paid back, too. Holdings in three joint ventures were sold, as a result of which the Group improved its liquidity by 55 million kroons (3.5 million euros). We have extended and restructured a half of our commercial papers in the amount of 26 million kroons (1.6 million euros), whereof approx. 8 million kroons (0.5 million euros) have been paid as a result of the sales of security assets. Major short-term liabilities during the next 12 months: the Ahtri project loan of 94.3 million kroons (6.0 million euros), „Tivoli” and „Laeva2” project loans in the total amount of 105.5 million kroons (6.7 million euros) „Kodukolde“ project loan in the amount of 46.0 million kroons (2.9 million euros). The loan for the Bišumuiža-1 (BM-1) development project in Riga in the amount of 48.2 million kroons (3.1 million euros), Calculated principal returns from the sales of booked spaces in the „Boulevard Residance Madrid“ project on Sofia as the house will be finished by the 1st half-year 2010 at the latest, in an amount of 120.7 million kroons (7.7 million euros), Commercial papers in the amount of 18 million kroons (1.2 million euros). On a current basis, loans have been redeemed in the „Kodukolde” and Merivälja 2 projects in Tallinn and the „Bišumuiža-1” in Riga as well as in projects creating cash flow. Most of the liabilities of the Group are in euros. SERVICE DIVISION Cost and business model optimisation has had good results but is still not sufficient for earning net profit on a current basis. By cash flow, the revenues and expenses of the division are in balance during the 12-month period and do not need any subsidy from parent company. Having the liquidity of the company as its priority, the division sold during the 12 months objects that were acquired earlier as short-term investments, due to the market situation, the prices have sometimes been under the book value. Division total EBIT was amounted to -7.1 million kroons (-0.4 million euros), whereof year-end investment property adjustments made up -6.1 million kroons (-0.4 million euros). Thus, quarter EBIT from the main activities -1.0 million kroons (-0.1 million euros) which is historically one of the best results. Optimisation of the cost structure and preparation of the business model and processes for the further improvement of the market situation is going on in the division. The number of brokerage transactions of the Group in 12 months has decreased by 41%, but the fall has stabilized recently. The number of valuation reports has decreased on year-over-year basis by 51%, but has demonstrated a slight increase during the last three quarters. As at the end of the 12-month period, the division employed 66 persons (12 months 2008: 139 persons). -------------------------------------------------------------------------------- | | 12 | 12 | change, | 2009 Q4 | 2008 Q4 | change, % | | | months | months | % | | | | | | 2009 | 2008 | | | | | -------------------------------------------------------------------------------- | Number | 986 | 1 674 | -41% | 259 | 503 | -49% | | of | | | | | | | | brokered | | | | | | | | objects | | | | | | | -------------------------------------------------------------------------------- | Projects | 151 | 282 | -47% | 171 | 272 | -37% | | being | | | | | | | | sold, | | | | | | | | pcs. | | | | | | | -------------------------------------------------------------------------------- | Number | 3 350 | 6 816 | -51% | 898 | 1 637 | -45% | | of | | | | | | | | valuatio | | | | | | | | n | | | | | | | | reports | | | | | | | -------------------------------------------------------------------------------- | Number | 34 | 38 | -11% | | | | | of | | | | | | | | appraise | | | | | | | | rs* | | | | | | | -------------------------------------------------------------------------------- | Number | 79 | 114 | -31% | | | | | of real | | | | | | | | estate | | | | | | | | brokers* | | | | | | | -------------------------------------------------------------------------------- | Average | 66 | 139 | -53% | | | | | number | | | | | | | | of staff | | | | | | | -------------------------------------------------------------------------------- * Includes authorisation agreements DEVELOPMENT DIVISION Within 12 months, 82 apartments or plots were sold in Arco Vara projects, thereby 41 of them in the fourth quarter. By the time of publishing the report, 18 units have been sold within two first months of the year and 4 additional transactions are in process. Under the Boulevard Residence Madrid project in Sofia, a long-term rental agreement with the Austrian supermarket chain Billa was concluded for approx. 900 m2, and a long-term lease agreement with a financial intermediary company for 4 700 m2 office space. Additionally, the trial on the establishment of the detailed plan of the Tivoli project was disposed and the Tallinn Administrative Court decision annulled. Based on the decision, the original detailed plan will remain into force without changes. The main risk factor for the development division is the refinancing of land bank loans in Estonia. Although the cash flow of the Group is tense, we consider it to be sensible to finish the unfinished projects thanks to more favourable construction prices in order to satisfy the demand with ready to be sold stock as well as improve the security assets of loans. Top priority for 2010 is completion of Madrid project where after the balancing date corresponding loans were prolonged. On a current basis, preparations are made in the Kodukolde and Tivoli projects in Tallinn, and negotiations held with banks on refinancing the construction. In the near future, the faster sales pace will bring the inventory to a minimum and in order to create turnover, building of new apartments has to be started. In order to manage the liquidity risk, the prices have been decreased in the ongoing projects in the Baltics and Sofia to improve sales, and holdings in three substantial joint ventures sold. For some employees, salaries and working times have been reduced. As at the end of the 12-month period, the division employed 23 persons (12 months 2008: 44 persons). Further information on the projects: www.arcorealestate.com/development CONSTRUCTION DIVISION The construction division has won tenders of environmental and infrastructure engineering. The average volume of the tenders has decreased and the contractor is the state institutions or local governments. During twelve months, the major new construction agreements were the Emajõe-Võhandu drinking water project and the Kohtla-Järve-Kiviõli sewerage project. After the balance sheet date, Arco Ehitus OÜ has been announced as best tenderer either alone or in a consortium or as subcontractor in tenders with a total value of 129.9 million kroons (8.3 million euros) (Kose pumping stations, Järvamaa Vocational Education Centre, Tartu Aviation College, Jõgeva city and parish pipework, Türi pipework). Within twelve months, new agreements in the amount of 171 million kroons (10.9 million euros) were concluded, thereof 34 millions kroons (2.2 million euros) in the 4th quarter. The backlog volume at the end of the year is 80.0 million kroons (5.1 million euros). At the year-end the division employed 59 persons (12 months 2008: 191 persons). On 29.12.2009, the holding in Arco Construction SIA was sold, as a result the number of employees in the Construction Division reduced by about 80 persons. Condensed consolidated interim financial statements Condensed consolidated income statement -------------------------------------------------------------------------------- | | Note | 12 months | 12 months | Q4 2009 | Q4 2008 | | | | 2009 | 2008 | | | -------------------------------------------------------------------------------- | in EEK, | | | | | | | thousands | | | | | | -------------------------------------------------------------------------------- | Rendering of | | 309 449 | 487 478 | 84 637 | 118 650 | | services | | | | | | -------------------------------------------------------------------------------- | Sale of | | 95 274 | 172 301 | 43 908 | 33 482 | | goods | | | | | | -------------------------------------------------------------------------------- | Total | | 404 723 | 659 779 | 128 545 | 152 132 | | revenue | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Cost of | 3 | -497 126 | -1 010 810 | -121 327 | -580 097 | | sales | | | | | | -------------------------------------------------------------------------------- | Gross profit | | -92 403 | -351 031 | 7 218 | -427 965 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Other | 4 | 136 865 | 30 644 | 28 087 | -1 720 | | operating | | | | | | | income | | | | | | -------------------------------------------------------------------------------- | Selling and | 5 | -4 417 | -12 344 | -1 097 | -568 | | distribution | | | | | | | costs | | | | | | -------------------------------------------------------------------------------- | Administrati | 6 | -87 455 | -125 584 | -30 064 | -15 639 | | ve expenses | | | | | | -------------------------------------------------------------------------------- | Other | 4 | -224 150 | -591 402 | -47 529 | -497 092 | | operating | | | | | | | expenses | | | | | | -------------------------------------------------------------------------------- | EBIT | | -271 560 | -1 049 717 | -43 385 | -942 984 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Finance | 7 | 8 946 | 76 089 | -6 615 | 19 948 | | income | | | | | | -------------------------------------------------------------------------------- | Finance | 7 | -62 666 | -177 702 | -46 568 | -136 534 | | expenses | | | | | | -------------------------------------------------------------------------------- | Profit / | | -325 280 | -1 151 330 | -96 568 | -1 059 570 | | loss before | | | | | | | tax | | | | | | -------------------------------------------------------------------------------- | | | | , | | | -------------------------------------------------------------------------------- | Income tax | | 868 | -8 811 | 1 677 | 1 976 | | expense | | | | | | -------------------------------------------------------------------------------- | Profit / | | -324 412 | -1 160 141 | -94 891 | -1 057 594 | | loss for the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Profit | 8 | | | | | | distribution | | | | | | | for the | | | | | | | period: | | | | | | -------------------------------------------------------------------------------- | Parent | | -324 412 | -1 154 959 | -95 001 | -1 047 882 | | company's | | | | | | | participatio | | | | | | | n in loss | | | | | | -------------------------------------------------------------------------------- | Minority | | 0 | -5 182 | 110 | -9 712 | | interest in | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | | | -324 412 | -1 160 141 | -94 891 | -1 057 594 | -------------------------------------------------------------------------------- | Other | | | | | | | aggregated | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Exchange | | 303 | 47 | 19 | -581 | | rate | | | | | | | differences | | | | | | | in | | | | | | | converting | | | | | | | foreign | | | | | | | company | | | | | | -------------------------------------------------------------------------------- | Aggregate | | -324 109 | -1 160 094 | -94 872 | -1 058 175 | | profit / | | | | | | | loss for the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Parent | | -324 109 | -1 154 912 | -94 982 | -1 048 463 | | company | | | | | | | participatio | | | | | | | n in | | | | | | | aggregate | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Minority | 8 | 0 | -5 182 | 110 | -9 712 | | interest in | | | | | | | aggregate | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Earning per | | | | | | | share | | | | | | -------------------------------------------------------------------------------- | - basic | | -3,42 | -12,18 | -1,00 | -11,05 | -------------------------------------------------------------------------------- | - diluted | | -3,42 | -12,18 | | -1,00 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | Note | 12 months | 12 months | Q4 2009 | Q4 2008 | | | | 2009 | 2008 | | | -------------------------------------------------------------------------------- | in EUR, | | | | | | | thousands | | | | | | -------------------------------------------------------------------------------- | Rendering of | | 19 777 | 31 156 | 5 409 | 7 583 | | services | | | | | | -------------------------------------------------------------------------------- | Sale of | | 6 089 | 11 012 | 2 806 | 2 140 | | goods | | | | | | -------------------------------------------------------------------------------- | Total | | 25 866 | 42 168 | 8 215 | 9 723 | | revenue | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Cost of | 3 | -31 772 | -64 603 | -7 754 | -37 075 | | sales | | | | | | -------------------------------------------------------------------------------- | Gross profit | | -5 906 | -22 435 | 461 | -27 352 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Other | 4 | 8 747 | 1 959 | 1 795 | -110 | | operating | | | | | | | income | | | | | | -------------------------------------------------------------------------------- | Selling and | 5 | -282 | -789 | -70 | -36 | | distribution | | | | | | | costs | | | | | | -------------------------------------------------------------------------------- | Administrati | 6 | -5 589 | -8 026 | -1 921 | -1 000 | | ve expenses | | | | | | -------------------------------------------------------------------------------- | Other | 4 | -14 326 | -37 797 | -3 038 | -31 770 | | operating | | | | | | | expenses | | | | | | -------------------------------------------------------------------------------- | EBIT | | -17 356 | -67 088 | -2 773 | -60 268 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Finance | 7 | 572 | 4 863 | -423 | 1 275 | | income | | | | | | -------------------------------------------------------------------------------- | Finance | 7 | -4 005 | -11 357 | -2 976 | -8 726 | | expenses | | | | | | -------------------------------------------------------------------------------- | Profit / | | -20 789 | -73 582 | -6 172 | -67 719 | | loss before | | | | | | | tax | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Income tax | | 55 | -563 | 107 | 126 | | expense | | | | | | -------------------------------------------------------------------------------- | Profit / | 8 | -20 734 | -74 145 | -6 065 | -67 593 | | loss for the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Profit | | | | | | | distribution | | | | | | | for the | | | | | | | period: | | | | | | -------------------------------------------------------------------------------- | Parent | | -20 734 | -73 815 | -6 072 | -66 972 | | company's | | | | | | | participatio | | | | | | | n in loss | | | | | | -------------------------------------------------------------------------------- | Minority | | 0 | -331 | 7 | -621 | | interest in | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Other | | | | | | | aggregated | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Exchange | | 19 | 3 | 1 | -37 | | rate | | | | | | | differences | | | | | | | in | | | | | | | converting | | | | | | | foreign | | | | | | | company | | | | | | -------------------------------------------------------------------------------- | Aggregate | | -20 715 | -74 142 | -6 064 | -67 630 | | profit / | | | | | | | loss for the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Parent | | -20 714 | -73 812 | -6 070 | -67 009 | | company | | | | | | | participatio | | | | | | | n in | | | | | | | aggregate | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Minority | | 0 | -331 | 7 | -621 | | interest in | | | | | | | aggregate | | | | | | | loss | | | | | | -------------------------------------------------------------------------------- | Earning per | 8 | | | | | | share | | | | | | -------------------------------------------------------------------------------- | - basic | | -0,22 | -0,78 | -0,06 | -0,71 | -------------------------------------------------------------------------------- | - diluted | | -0,22 | -0,78 | -0,06 | -0,71 | -------------------------------------------------------------------------------- Consolidated statement of financial position -------------------------------------------------------------------------------- | EEK | EUR | -------------------------------------------------------------------------------- | | Note | 31.12.200 | 31.12.200 | 31.12.2009 | 31.12.2008 | | | | 9 | 8 | | | -------------------------------------------------------------------------------- | in thousands | | | | | | -------------------------------------------------------------------------------- | Cash and cash | | 71 392 | 172 574 | 71 392 | 11 029 | | equivalents | | | | | | -------------------------------------------------------------------------------- | Financial | | 0 | 40 416 | 0 | 2 583 | | assets | | | | | | -------------------------------------------------------------------------------- | Receivables | 9 | 164 075 | 294 352 | 164 075 | 18 813 | -------------------------------------------------------------------------------- | Prepayments | | 4 889 | 6 165 | 4 889 | 394 | -------------------------------------------------------------------------------- | Inventories | 10 | 776 601 | 849 440 | 776 601 | 54 289 | -------------------------------------------------------------------------------- | Biological | | 0 | 3 679 | 0 | 235 | | assets | | | | | | -------------------------------------------------------------------------------- | Total current | | 1 016 957 | 1 366 626 | 1 016 957 | 87 343 | | assets | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Financial | | 15 613 | 255 | 15 613 | 16 | | assets | | | | | | -------------------------------------------------------------------------------- | Receivables | 9 | 6 304 | 6 671 | 6 304 | 427 | -------------------------------------------------------------------------------- | Investment | 12 | 328 988 | 542 753 | 328 988 | 34 688 | | property | | | | | | -------------------------------------------------------------------------------- | Property, plant | 13 | 10 545 | 41 812 | 10 545 | 2 672 | | and equipment | | | | | | -------------------------------------------------------------------------------- | Intangible | 14 | 812 | 12 475 | 812 | 797 | | assets | | | | | | -------------------------------------------------------------------------------- | Total | | 362 262 | 603 966 | 362 262 | 38 600 | | non-current | | | | | | | assets | | | | | | -------------------------------------------------------------------------------- | TOTAL ASSETS | | 1 379 219 | 1 970 592 | 1 379 219 | 125 943 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Loans and | 15 | 601 443 | 353 417 | 601 443 | 22 587 | | borrowings | | | | | | -------------------------------------------------------------------------------- | Liabilities | 16 | 94 550 | 132 677 | 94 550 | 8 480 | -------------------------------------------------------------------------------- | Deferred income | | 82 164 | 65 174 | 82 164 | 4 165 | -------------------------------------------------------------------------------- | Provisions | | 12 650 | 5 917 | 12 650 | 378 | -------------------------------------------------------------------------------- | Total current | | 790 807 | 557 185 | 790 807 | 35 610 | | liabilities | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Loans and | 15 | 198 099 | 692 919 | 198 099 | 44 286 | | borrowings | | | | | | -------------------------------------------------------------------------------- | Liabilities | 16 | 5 163 | 4 404 | 5 163 | 281 | -------------------------------------------------------------------------------- | Deferred income | | 0 | 20 | 0 | 1 | | tax liability | | | | | | -------------------------------------------------------------------------------- | Provisions | | 1 100 | 4 291 | 1 100 | 274 | -------------------------------------------------------------------------------- | Total | | 204 362 | 701 634 | 204 362 | 44 842 | | non-current | | | | | | | liabilities | | | | | | -------------------------------------------------------------------------------- | TOTAL | | 995 169 | 1 258 819 | 995 169 | 80 452 | | LIABILITIES | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Share capital | | 952 842 | 952 842 | 952 842 | 60 898 | -------------------------------------------------------------------------------- | Share premium | | 0 | 712 514 | 0 | 45 538 | -------------------------------------------------------------------------------- | Statutory | | 31 463 | 31 463 | 31 463 | 2 011 | | capital reserve | | | | | | -------------------------------------------------------------------------------- | Retained | | -596 263 | -984 668 | -596 263 | -62 932 | | earnings | | | | | | -------------------------------------------------------------------------------- | Own shares | | -3 992 | -3 992 | -3 992 | -255 | -------------------------------------------------------------------------------- | Total equity | 17 | 384 050 | 708 159 | 384 050 | 45 260 | | attributable to | | | | | | | equity holders | | | | | | | of the parent | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Minority | | 0 | 3 614 | 0 | 231 | | interests | | | | | | -------------------------------------------------------------------------------- | Total equity | | 384 050 | 711 773 | 384 050 | 45 491 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | TOTAL | | 1 379 219 | 1 970 592 | 1 379 219 | 125 943 | | LIABILITIES AND | | | | | | | EQUITY | | | | | | -------------------------------------------------------------------------------- Condensed consolidated interim cash flow statement -------------------------------------------------------------------------------- | EEK | EUR | -------------------------------------------------------------------------------- | | Note | 12 months | 12 months | 12 months | 12 months | | | | 2009 | 2008 | 2009 | 2008 | -------------------------------------------------------------------------------- | in thousands | | | | | | -------------------------------------------------------------------------------- | Net profit / loss | | -324 412 | -1 160 141 | -20 734 | -74 145 | -------------------------------------------------------------------------------- | Interest income | 7 | 33 505 | -5 080 | 2 141 | -325 | | and expense | | | | | | -------------------------------------------------------------------------------- | Gains and losses | | 3 617 | 41 295 | 231 | 2 639 | | on disposal of | | | | | | | subsidiaries and | | | | | | | interests in | | | | | | | jointly | | | | | | | controlled | | | | | | | entities | | | | | | -------------------------------------------------------------------------------- | Gains and losses | 7 | -2 032 | -2 429 | -130 | -155 | | on other | | | | | | | financial assets | | | | | | -------------------------------------------------------------------------------- | Impairment losses | 7 | 15 685 | 72 435 | 1 002 | 4 629 | | on financial | | | | | | | assets | | | | | | -------------------------------------------------------------------------------- | Depreciation, | 3,4,6 | 6 831 | 7 412 | 437 | 474 | | amortisation and | | | | | | | impairment losses | | | | | | | on property, | | | | | | | plant and | | | | | | | equipment and | | | | | | | intangible assets | | | | | | -------------------------------------------------------------------------------- | Goodwill | | 10 896 | 8 720 | 696 | 557 | | adjustments and | | | | | | | recognition of | | | | | | | negative goodwill | | | | | | | as revenues | | | | | | -------------------------------------------------------------------------------- | Gain / loss on | 3,4,6 | 1 550 | -248 | 99 | -16 | | the sale of | | | | | | | property, plant | | | | | | | and equipment and | | | | | | | intangible assets | | | | | | -------------------------------------------------------------------------------- | Gain / loss on | 4 | -1 088 | -1 535 | -70 | -98 | | the sale of | | | | | | | investment | | | | | | | property | | | | | | -------------------------------------------------------------------------------- | Change in the | 4 | 89 941 | 555 629 | 5 748 | 35 511 | | fair value of | | | | | | | investment | | | | | | | property and | | | | | | | biological assets | | | | | | -------------------------------------------------------------------------------- | Profit/loss from | 3 | 142 148 | 434 272 | 9 085 | 27 755 | | property and | | | | | | | inventory | | | | | | | revaluation | | | | | | -------------------------------------------------------------------------------- | Exchange gains | 7 | 2 945 | -4 608 | 188 | -295 | | and losses | | | | | | -------------------------------------------------------------------------------- | Corporate income | | 0 | 12 744 | 0 | 814 | | tax expense | | | | | | -------------------------------------------------------------------------------- | Operating cash | | -20 414 | -41 534 | -1 307 | -2 655 | | flow before | | | | | | | working capital | | | | | | | changes | | | | | | -------------------------------------------------------------------------------- | Change in | | 59 543 | -12 481 | 3 805 | -798 | | receivables and | | | | | | | prepayments | | | | | | -------------------------------------------------------------------------------- | Change in | | -103 439 | -99 831 | -6 611 | -6 380 | | inventories | | | | | | -------------------------------------------------------------------------------- | Change in | | 2 190 | 0 | 140 | 0 | | biological assets | | | | | | -------------------------------------------------------------------------------- | Change in | | 38 513 | 26 273 | 2 461 | 1 679 | | payables and | | | | | | | deferred income | | | | | | -------------------------------------------------------------------------------- | NET CASH USED IN | | -23 607 | -127 573 | -1 512 | -8 154 | | OPERATING | | | | | | | ACTIVITIES | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Acquisition of | | -1 961 | -39 108 | -125 | -2 499 | | property, plant | | | | | | | and equipment and | | | | | | | intangible assets | | | | | | -------------------------------------------------------------------------------- | Proceeds from | | 5 729 | 729 | 366 | 47 | | sale of property, | | | | | | | plant and | | | | | | | equipment and | | | | | | | intangible assets | | | | | | -------------------------------------------------------------------------------- | Acquisition of | | -3 132 | -4 222 | -200 | -270 | | investment | | | | | | | property | | | | | | -------------------------------------------------------------------------------- | Proceeds from | | 8 581 | 32 218 | 548 | 2 059 | | sale of | | | | | | | investment | | | | | | | property | | | | | | -------------------------------------------------------------------------------- | Acquisition of | | -585 | -45 875 | -37 | -2 932 | | subsidiaries and | | | | | | | interests in | | | | | | | jointly | | | | | | | controlled | | | | | | | entities | | | | | | -------------------------------------------------------------------------------- | Proceeds from | | 38 105 | -2 912 | 2 435 | -186 | | disposal of | | | | | | | subsidiaries and | | | | | | | interests in | | | | | | | jointly | | | | | | | controlled | | | | | | | entities | | | | | | -------------------------------------------------------------------------------- | Acquisition of | | 0 | -202 665 | 0 | -12 953 | | other financial | | | | | | | assets | | | | | | -------------------------------------------------------------------------------- | Proceeds from | | 40 416 | 294 621 | 2 583 | 18 830 | | sale of other | | | | | | | financial assets | | | | | | -------------------------------------------------------------------------------- | Loans granted | | -2 111 | -130 158 | -135 | -8 319 | -------------------------------------------------------------------------------- | Repayment of | | 5 878 | 2 422 | 376 | 155 | | loans granted | | | | | | -------------------------------------------------------------------------------- | Interest received | | 4 618 | 32 328 | 295 | 2 066 | -------------------------------------------------------------------------------- | NET CASH USED IN | | 95 538 | -62 622 | 6 106 | -4 002 | | / FROM INVESTING | | | | | | | ACTIVITIES | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Proceeds from | | 120 998 | 312 739 | 7 733 | 19 988 | | loans received | | | | | | -------------------------------------------------------------------------------- | Repayment of | | -241 699 | -570 911 | -15 447 | -36 488 | | loans and payment | | | | | | | of finance lease | | | | | | | liabilities | | | | | | -------------------------------------------------------------------------------- | Change in | | 0 | -14 | 0 | -1 | | overdraft | | | | | | -------------------------------------------------------------------------------- | Repurchase of own | | 0 | -3 992 | 0 | -255 | | shares | | | | | | -------------------------------------------------------------------------------- | Interest paid | | -47 261 | -82 271 | -3 021 | -5 258 | -------------------------------------------------------------------------------- | Dividends paid | | -5 454 | -42 274 | -349 | -2 702 | -------------------------------------------------------------------------------- | Income tax paid | | 0 | -15 516 | 0 | -992 | | on dividends | | | | | | -------------------------------------------------------------------------------- | NET CASH USED IN | | -173 416 | -402 239 | -11 084 | -25 708 | | / FROM FINANCING | | | | | | | ACTIVITIES | | | | | | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | NET CASH FLOW | | -101 485 | -592 434 | -6 490 | -37 864 | -------------------------------------------------------------------------------- | | | | | | | -------------------------------------------------------------------------------- | Cash and cash | | 172 574 | 765 008 | 11 029 | 48 893 | | equivalents at | | | | | | | beginning of | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Decrease / | | -101 485 | -592 434 | -6 486 | -37 864 | | increase in cash | | | | | | | and cash | | | | | | | equivalents | | | | | | -------------------------------------------------------------------------------- | Effect of | | 303 | | 19 | 0 | | exchange rate | | | | | | | fluctuations | | | | | | -------------------------------------------------------------------------------- | Cash and cash | | 71 392 | 172 574 | 4 562 | 11 029 | | equivalents at | | | | | | | end of period | | | | | | --------------------------------------------------------------------------------
FOURTH QUARTER AND TWELVE MONTHS 2009 CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
| Source: Arco Vara
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