23 April 2003 8.30 am
Net sales: EUR 71.7 million (EUR 61.0 million)
Operating profit: EUR 4.8 million (EUR 4.3 million)
Earnings/share: EUR 0.16 (EUR 0.14)
Return on invested capital (ROI): 11.6% (10.5%)
NET SALES AND RESULTS
Lassila & Tikanoja net sales increased by 17.7%. Almost 13% of this came from company acquisitions, the rest being organic growth. Earnings per share improved, and stood at EUR 0.16. Performance was hampered by the extremely cold winter, which affected productivity, and by the integration costs involved in the acquisition of a relatively large cleaning services company, SPS Siivouspalvelut Oy. In addition, two smaller companies were acquired during the period.
Net sales by Environmental Services (waste management, recycling services, environmental products) increased by 14.2% and operating profit by 19.1%. The higher profitability was mainly the result of more efficient waste management operations. The result of recycling services improved less than expected, because the volume of material processed fell somewhat mainly due to the cold winter. Investments in the growing recycling business will continue. Net sales of and profits from environmental products fell.
Net sales by Property Services (property maintenance and cleaning services) rose by 28.9%, but the operating result fell by 4.8%. As expected, the cleaning services result was weakened by the cost of integrating SPS Siivouspalvelut Oy, and this impact will continue for the next two quarters. The integration process has proceeded according to plan. Property maintenance performance improved, reaching a very good level for the time of year. The improvement can be attributed to new production planning and control methods introduced last year, and to higher net sales. Investment in maintenance of technical systems continued.
Net sales by Industrial Services (hazardous waste management, industrial cleaning, damage repair services and sewer maintenance) rose by 5.2%. Net sales by all product lines increased, with the exception of hazardous waste management. Operating profit improved slightly in the division, but nevertheless fell clearly short of target, especially in damage repair services and hazardous waste management. The profitability of hazardous waste management will be improved when the new physical-chemical treatment plant opens later in the spring. The performance of industrial cleaning improved thanks to successful sales work. In damage repair services, capacity has been adjusted to correspond to demand. These measures will have full effect in the latter half of the year.
FINANCING
Interest-bearing liabilities amounted to EUR 5.7 million less than a year earlier and to EUR 1.5 million more than at the end of the previous financial year. Net financial expenses were 1.4% of net sales and 20.2% of operating profit. EUR 2.9 million was tied up in working capital during the review period (EUR 1.2 million). The equity ratio was 40.8%(38.5%)and the gearing rate was 83.8 (85.6).
INVESTMENTS
Gross investments totalled EUR 9.2 million (EUR 3.8 million). The largest single investment was the acquisition of SPS Siivouspalvelut Oy, a cleaning company, at the beginning of the period. In addition, machinery and equipment was replaced, production premises were expanded and two minor corporate acquisitions made. Depreciation came to EUR 6.1 million.
ANNUAL GENERAL MEETING
The Annual General Meeting of Lassila & Tikanoja plc was held on 1 April 2003. The meeting decided on payment of a dividend of EUR 0.75 per share. 11 April 2003 was designated as the dividend payment date.
The Annual General Meeting approved the Statement of Income, the Balance Sheet, the Consolidated Statement of Income and the Consolidated Balance Sheet and granted freedom from liability to the members of the Board of Directors and the President and CEO.
Heikki Hakala, Juhani Lassila and Juhani Maijala were re-elected to the Board of Directors for the period 2003-2004. The Board of Directors comprises the following persons: Heikki Hakala, Lasse Kurkilahti, Juhani Lassila, Juhani Maijala and Soili Suonoja. The Board of Directors met immediately after the AGM and re-elected Juhani Maijala as full-time chairman. Heikki Hakala was re-elected deputy chairman of the Board.
PricewaterhouseCoopers Oy, Authorized Public Accountants, were elected auditors.
AUTHORISATION FOR THE BOARD OF DIRECTORS
The Board of Directors is not authorised to effect any share issues or to launch a convertible bond or a bond with warrants. Neither is the Board authorised to decide on the repurchase nor disposal of the Company’s own shares.
COMPANY SHARES
The volume of trading in Lassila & Tikanoja plc shares on the Helsinki Exchanges from January through March was 1,161,452, which is 7.3% of the number of shares. The value of trading was EUR 18.5 million. The trading price varied between EUR 15.01 and 17.50 EUR. The final trading price was EUR 16.70. The market capitalisation was EUR 264.3 million on 31 March 2003. The total number of shares is 15,826,308.
PROSPECTS FOR THE REST OF THE YEAR
Demand for Lassila & Tikanoja’s services is estimated to increase also this year at a higher rate than the GDP. Net sales are expected to grow at a clearly quicker pace than in 2002 and results are expected to improve. This forecast is supported by, for example, the corporate acquisitions carried out last year and early this year, better sales resources and new production management methods.
STATEMENT OF INCOME
|
EUR 1000
|
1-3/2003
|
%
|
1-3/
2002 |
%
|
Change % |
1-12/
2002 |
%
|
|
NET SALES |
71 737 |
100.0 |
60 967 |
100.0 |
17.7 |
267 175 |
100.0 |
|
Cost of goods sold
|
-60 919
|
-84.9
|
-51 318
|
-84.2
|
18.7
|
-217 611
|
-81.4
|
|
GROSS PROFIT |
10 818 |
15.1 |
9 649 |
15.8 |
12.1 |
49 564 |
18.6 |
|
Sales and marketing expenses |
-1 879
|
-2.6
|
-1 902
|
-3.1
|
|
-8 582
|
-3.2
|
|
Administration expenses |
-2 490
|
-3.5
|
-2 190
|
-3.6
|
|
-8 637
|
-3.2
|
|
Other operating income and expenses
|
184
|
0.3
|
72
|
0.1
|
|
409
|
0.2
|
|
OPERATING
PROFIT BEFORE DEPRECIATION ON GOODWILL |
6 633
|
9.2
|
5 629
|
9.2
|
17.8
|
32 754
|
12.3
|
|
Depreciation on goodwill |
-1 828
|
-2.5
|
-1 372
|
-2.3
|
|
-5 905
|
-2.2
|
|
OPERATING PROFIT
|
4 805
|
6.7
|
4 257
|
7.0
|
12.9
|
26 849
|
10.0
|
|
Financial income and expenses
|
-971
|
-1.4
|
-931
|
-1.5
|
4.3
|
-3 677
|
-1.4
|
|
PROFIT BEFORE EXTRAORDINARY ITEMS |
3 834
|
5.3
|
3 326
|
5.5
|
15.3
|
23 172
|
8.7
|
|
Extraordinary items
|
|
|
|
|
|
|
|
|
PROFIT BEFORE INCOME TAXES |
3 834
|
5.3
|
3 326
|
5.5
|
15.3
|
23 172
|
8.7
|
|
Income taxes |
-1 302* |
-1.8 |
-1 136* |
-1.9 |
|
-7 189 |
-2.7 |
|
Minority interests
|
-36
|
|
|
|
|
-99
|
|
|
PROFIT FOR THE
PERIOD |
2 496
|
3.5
|
2 190
|
3.6
|
14.0
|
15 884
|
5.9
|
* Taxes on the profit for the period under review.
BALANCE SHEET
EUR 1000
|
|
3/2003
|
3/2002
|
12/2002
|
|
ASSETS
|
|
|
|
|
Fixed assets |
|
|
|
|
Intangible assets |
85 640 |
81 583 |
83 795 |
|
Tangible assets |
90 539 |
79 838 |
89 396 |
|
Financial assets |
3 438 |
3 397 |
3 468 |
|
Fixed assets, total |
179 617 |
164 818 |
176 659 |
|
|
|
|
|
|
Current assets |
|
|
|
|
Inventories |
2 313 |
1 914 |
2 311 |
|
Non-current receivables |
1 |
1 |
1 |
|
Current receivables |
32 550 |
30 133 |
28 292 |
|
Cash at bank and in hand |
4 734 |
15 333 |
4 795 |
|
Current assets, total
|
39 598 |
47 381 |
35 399 |
|
Assets, total
|
219 215 |
212 199 |
212 058 |
|
SHAREHOLDERS' EQUITY AND LIABILITIES |
|
|
|
|
Shareholders’ equity |
|
|
|
|
Share capital |
7 913 |
7 913 |
7 913 |
|
Other restricted equity |
7 518 |
7 518 |
7 518 |
|
Equity share of accumulated appropriations |
2 618 |
730 |
2 943 |
|
Other unrestricted equity |
70 428 |
65 622 |
67 607 |
|
Shareholders’ equity, total
|
88 477 |
81 783 |
85 981 |
|
Minority interests |
941 |
|
895 |
|
Provisions |
526 |
526 |
526 |
|
|
|
|
|
|
Liabilities |
|
|
|
|
Deferred tax liability |
5 828 |
4 430 |
5 827 |
|
Non-current liabilities |
66 441 |
76 138 |
66 450 |
|
Current liabilities |
57 002 |
49 322 |
52 379 |
|
Liabilities, total
|
129 271 |
129 890 |
124 656 |
|
Shareholders' equity and liabilities, total |
219 215
|
212 199
|
212 058
|
KEY FIGURES
|
|
3/2003 |
3/2002
|
12/2002
|
|
Earnings/share, EUR |
0.16 |
0.14 |
1.00 |
|
Equity/share, EUR |
5.59 |
5.17 |
5.43 |
|
Cash flow from operations/share, EUR |
0.41 |
0.49 |
2.66 |
|
Return on equity (ROE), % |
11.5 |
10.9 |
19.2 |
|
Return on invested capital (ROI), % |
11.6 |
10.5 |
16.5 |
|
Equity ratio, % |
40.8 |
38.5 |
41.0 |
|
Gearing, % |
83.8 |
85.6 |
84.4 |
|
EVA, EUR million |
1.1* |
0.3** |
11.3** |
|
Gross investments, EUR 1000 |
9 219 |
3 792 |
33 640 |
|
Depreciation, EUR 1000 |
6 086 |
5 350 |
22 220 |
|
Net interest-bearing liabilities, EUR 1000 |
74 905 |
69 970 |
73 311 |
|
Average personnel converted to full-time |
4 414 |
3 589 |
3 763 |
EVA = Operating profit – cost calculated on invested capital (average of four quarters)
* WACC = 9.0
** WACC = 9.5
CASH FLOW STATEMENT
|
EUR 1000
|
3/2003
|
3/2002
|
12/2002
|
|
Cash flow before change in working capital |
10 679 |
9 500 |
48 599 |
|
Change in working capital |
-2 888 |
-1 177 |
5 664 |
|
Financial items and taxes |
-1 377 |
-490 |
-12 229 |
|
Cash flow from operations
|
6 414 |
7 833 |
42 034 |
|
Investments in group companies |
-2 574 |
-1 607 |
-9 737 |
|
Other investments |
-5 675 |
-3 327 |
-22 993 |
|
Proceeds from sale of fixed assets |
326 |
270 |
1 766 |
|
Cash flow from investing activities
|
-7 923 |
-4 664 |
-30 964 |
|
Dividends paid |
|
|
-9 484 |
|
Change in interest-bearing liabilities |
1 448 |
-140 |
-9 096 |
|
Cash flow from financing
|
1 448 |
-140 |
-18 580 |
|
Change in cash and cash equivalents |
-61 |
3 029 |
-7 510 |
FIGURES BY DIVISION
NET SALES
|
EUR 1000
|
3/2003
|
3/2002
|
change %
|
12/2002
|
|
Environmental Services |
31 229 |
27 340 |
14,2 |
122 327 |
|
Property Services |
27 938 |
21 674 |
28,9 |
87 841 |
|
Industrial Services |
12 570 |
11 953 |
5,2 |
57 007 |
|
Total |
71 737 |
60 967 |
17,7 |
267 175 |
OPERATING PROFIT
|
|
3/2003 |
|
|
3/2002 |
|
12/2002 |
|
|
EUR 1000
|
% of net sales
|
EUR 1000
|
% of net sales
|
EUR 1000
|
% of net sales
|
|
Environmental Services |
3 432
|
11.0
|
2 881
|
10.5
|
15 863
|
13.0
|
|
Property Services |
1 206
|
4.3
|
1 267
|
5.8
|
6 219
|
7.1
|
|
Industrial Services |
167
|
1.3
|
109
|
0.9
|
4 767
|
8.4
|
|
Total |
4 805 |
6.7 |
4 257 |
7.0 |
26 849 |
10.0 |
QUARTERLY FIGURES
|
EUR 1000
|
Q103
|
Q402
|
Q302
|
Q202
|
|
NET SALES
|
|
|
|
|
|
Environmental Services |
31 229 |
31 819 |
32 151 |
31 017 |
|
Property Services |
27 938 |
22 914 |
21 710 |
21 543 |
|
Industrial Services |
12 570 |
14 116 |
16 455 |
14 483 |
|
Total |
71 737 |
68 849 |
70 316 |
67 043 |
|
|
|
|
|
|
|
OPERATING PROFIT |
|
|
|
|
|
Environmental Services |
3 432 |
3 726 |
5 464 |
3 792 |
|
Property Services |
1 206 |
1 694 |
2 686 |
572 |
|
Industrial Services |
167 |
414 |
2 770 |
1 474 |
|
Total
|
4 805 |
5 834 |
10 920 |
5 838 |
|
NET FINANCIAL EXPENSES |
-971 |
-866 |
-954 |
-926 |
|
PROFIT BEFORE EXTRAORDINARY ITEMS |
3 834
|
4 968
|
9 966
|
4 912
|
|
|
|
|
|
|
|
OPERATING MARGIN |
|
|
|
|
|
Environmental Services |
11.0 |
11.7 |
17.0 |
12.2 |
|
Property Services |
4.3 |
7.4 |
12.4 |
2.7 |
|
Industrial Services |
1.3 |
2.9 |
16.8 |
10.2 |
|
Lassila & Tikanoja |
6.7 |
8.5 |
15.5 |
8.7 |
|
|
Q102
|
Q401
|
Pro forma
Q301 |
Pro forma
Q201 |
|
NET SALES |
|
|
|
|
|
Environmental Services |
27 340
|
28 959
|
28 681
|
29 157
|
|
Property Services |
21 674 |
20 246 |
19 680 |
19 609 |
|
Industrial Services |
11 953 |
13 344 |
13 476 |
14 553 |
|
Total |
60 967 |
62 549 |
61 837 |
63 319 |
|
|
|
|
|
|
|
OPERATING PROFIT |
|
|
|
|
|
Environmental Services |
2 881 |
2 574 |
4 218 |
3 371 |
|
Property Services |
1 267 |
1 700 |
2 994 |
1 338 |
|
Industrial Services |
109 |
964 |
1 934 |
1 988 |
|
Total
|
4 257 |
5 238 |
9 146 |
6 697 |
|
NET FINANCIAL EXPENSES |
-931 |
-931 |
-1 334 |
-1 178 |
|
PROFIT BEFORE EXTRAORDINARY ITEMS |
3 326
|
4 307
|
7 812
|
5 519
|
|
|
|
|
|
|
|
OPERATING MARGIN |
|
|
|
|
|
Environmental Services |
10.5 |
8.9 |
14.7 |
11.6 |
|
Property Services |
5.8 |
8.4 |
15.2 |
6.8 |
|
Industrial Services |
0.9 |
7.2 |
14.4 |
13.7 |
|
Lassila & Tikanoja |
7.0 |
8.4 |
14.8 |
10.6 |
CONTINGENT LIABILITIES
|
EUR 1000
|
3/2003
|
3/2002
|
12/2002
|
|
SECURITY FOR COMPANY LIABILITIES |
|
|
|
|
Pledges |
112 |
25 |
97 |
|
Real estate mortgages |
3 445 |
3 445 |
3 613 |
|
Corporate mortgages
|
529 |
|
25 |
|
LIABILITIES |
|
|
|
|
Leasing payments and liabilities |
312 |
360 |
312 |
DERIVATIVE CONTRACTS
|
EUR 1000
|
3/2003
|
3/2002
|
12/2002
|
|
INTEREST RATE SWAPS |
|
|
|
|
Nominal values |
52 000 |
52 000 |
52 000 |
|
Market value |
-2 833 |
-970 |
-2 430 |
The figures have not been audited.
Lassila & Tikanoja plc was registered on 30 September 2001, when Lassila & Tikanoja plc (former) was demerged into two new listed companies, Lassila & Tikanoja plc and ja J.W. Suominen Group plc. The financial data for the financial year 1 January to 31 December 2001 and for the time before the demerger consist of pro forma figures. They are based on the financial statements of the former Lassila & Tikanoja Group for the period from 1 January 1997 to 30 September 2001 and on the financial statements of the new Lassila & Tikanoja group for the period from 30 September to 31 December 2001. They have been calculated as if the demerger had taken place on 1 January 1997. The pro forma calculation principles are explained in detail in the Demerger Prospectus/Tender Offer Document of 1 March 2001, updated 26 September 2001.
Helsinki, 22 April 2003
LASSILA & TIKANOJA PLC
Board of Directors
Juhani Maijala
Chairman
For additional information please contact Jari Sarjo,
President and CEO, tel. +358 10 636 111.