- ISIN EE3100092503
Skano Group
Financial result, 6 months 2013
Skano Group
23.08.2013 15:15
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Pärnu, 2013-08-23 15:15 CEST (GLOBE NEWSWIRE) --
SECOND QUARTER IN SHORT
Consolidated net sales of the second quarter of 2013 was 4.7 mil. euros,
representing a 3% decrease on the second quarter compared to the same period in
2012. At the same time, consolidated EBITDA amounted to 123 thousand euros (364
thousand euros in Q2 2012).
The sales in Skano Pärnu fibreboard factory (incl. Isotex) was 1.7 mil. euros,
decreased as compared to the respective period last year by 5%, the operating
loss of the second quarter was 76 thousand euros compared with the operating
profit 36 thousand euros last year.
The turnover of Skano Püssi fibreboard factory was 889 thousand euros,
representing 25% increase in the second quarter compared to the same period in
2012. Operating loss amounted to 158 thousand euros compared with the operating
loss 203 thousand euros last year. Due to weak demand Püssi factory was
operating at approximately of 70-80% of its capacity in the second quarter of
2013.
Although sales were on the same level compare to the second quarter of 2012 the
down pressure to sales was felt due to weak economic situation in Europe.
Profitability of Fibreboard division was affected by very fragmented production
portfolio where high number of small size orders caused low production
efficiency and high COGS. The priority of the management of the company is
continuously to ensure the sales of the production of both factories in order
to guarantee the maximum production capacity and efforts are taken in this
direction on an on-going basis.
The turnover of Skano furniture factory in Pärnu decreased in the second
quarter by 12% and amounted to 1 831 thousand euros. The operating profit of
the second quarter was 133 thousand euros as in 2012 the operating profit of
the same period was 238 thousand euros. Sales in the second quarter of 2013
decreased in all regions (except for sales to the subsidiary) due to weak
demand of foreign markets. Sales dropped the most in Finland, by 29% compared
to the same period in 2012. The company is seeking new sale's possibilities in
the current markets but going into totally new markets is a substantial
direction for us.
The turnover of Skano furniture retail chain increased 9% as compared to the
same period last year being 619 thousand euros, operating loss was 3 thousand
euros compared with the sales 569 thousand and operating profit 63 thousand
euros in the second quarter of 2012. Current year operating loss contains also
loss from currency exchange rate of hryvnia 14 thousand euros (profit from
currency exchange rate 50 thousand euros in the same period of 2012). Retail
sale increased in Estonia and Lithuania but decreased in Latvia and dropped in
large extent in Ukraine (-38%). The sales of Skano Group AS own furniture still
forms a considerable part of the retail sale and it enables the furniture
factory to operate much more profitably than it would be possible without its
own retail chain.
INCOME STATEMENT
Consolidated net sales of the second quarter in 2013 was 4.7 mil. euros (4.9
mil. euros in same period of 2012) representing a 3% decrease on the second
quarter compared to Q2 2012. The Group's gross margin in the second quarter of
2013 was 15.6% compared to 17.9% in the second quarter of 2012. Consolidated
operating loss amounted to 104 thousand euros (operating profit 108 thousand
euros from main activities in same period 2012). The consolidated operating
margin of net sales was -2% (+2% from main activities in Q2 2012).
Consolidated net loss amounted to 164 thousand euros (compared to net profit 39
thousand euros in Q2 2012), and the net margin was -3% (+1% in Q2 2012).
POSITION OF FINANCIAL STATEMENT
As of 30.06.2013 the total assets of Skano Group AS amounted to 15.3 mil. euros
(30.06.2012: 16.1 mil. euros). The liabilities of the company accounted for
54.1% (30.06.2012: 53.1%) thereof, i.e. 8.2 mil. euros (30.06.2012: 8.5 mil.
euros).
Receivables and prepayments have decreased by 0.2 mil. euros i.e. 8% decrease
with 12 months. The reason of decrease of receivables was implementation of
factoring instrument.
Inventories remained at the same level compared to last year, amounting to 3.3
mil. euros on 30.06.2013. (30.06.2012: 3.3 mil. euros). Property, plant and
intangibles decreased by 0.5 mil. euros mainly as a result of depreciation.
Short-term loans decreased by 0.03 mil. euros and amounted to 1.25 mil. euros
in 30.06.2013 (30.06.2012: 1.28 mil. euros). Supplier payables, tax
liabilities, other payables, including payables to employees, and provisions
amounted to 2.4 mil. euros (30.06.2012: 2.5 mil. euros). Current and
non-current liabilities decreased by 0.3 mil. euros to 8.2 mil. euros
(30.06.2012: 8.5 mil. euros).
DIVISIONAL REVIEW
NET SALES BY BUSINESS SEGMENTS
th EUR % of net sales
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Q2 2013 Q2 2012 Q2 2013 Q2 2012
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Skano Fibreboard 2,631 2,621 55.5% 53.7%
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Skano Furniture factory 1,831 2,070 38.7% 42.4%
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Skano Furniture retail 619 569 13.1% 11.7%
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Elimination (344) (379) (7.3%) (7.8%)
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TOTAL 4,737 4,881 100.0% 100.0%
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NET SALES BY GEOGRAPHICAL SEGMENTS
th EUR % of net sales
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Q2 2013 Q2 2012 Q2 2013 Q2 2012
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Russia 1,636 1,480 34.5% 30.3%
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Finland 1,404 1,569 29.6% 32.1%
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Estonia 704 676 14.9% 13.8%
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Great Britain 235 312 5.0% 6.4%
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Lithuania 165 86 3.5% 1.8%
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Sweden 146 128 3.1% 2.6%
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Ukraine 136 188 2.9% 3.9%
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Latvia 112 154 2.4% 3.2%
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Netherlands 51 124 1.1% 2.5%
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Kazakhstan 39 40 0.8% 0.8%
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Csech republic 20 0 0.4% 0.0%
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Germany 18 23 0.4% 0.5%
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India 14 15 0.3% 0.3%
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Other countries 57 86 1.2% 1.8%
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TOTAL 4,737 4,881 100.0% 100.0%
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Regarding the markets, turnover has increased in Russia, Estonia and Lithuania.
The percentage of turnover has decreased in most in Finland, Great Britain and
Netherlands.
PROFIT BY BUSINESS SEGMENTS
th EUR Q2 2013 Q2 2012
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Skano Furniture factory 133 238
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Skano Furniture retail (3) 63
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Skano Fibreboard (234) (167)
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Elimination 0 (26)
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TOTAL (104) 108
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Net financial costs (60) (67)
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Income tax 0 (2)
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NET PROFIT (164) 39
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SKANO FIBREBOARD
The net sales of Skano Fibreboard in the second quarter of 2013 amounted to
2.63 mil. euros and operating loss to 234 thousand euros. In the same period
last year, the turnover of the division totaled to 2.62 mil. euros and the
operating loss from main activities 167 thousand euros. Sales have dropped in
all regions except for Russia, Sweden and Finland due to weak economic
situation in Europe. In spite of deteriorated economic situation company
managed to increase sales in Finland due to a new distribution partner and a
strategic cooperation agreement. The biggest drop in sales in the second
quarter compare to last year took place in Great Britain and Netherlands, 27%
and 59% respectively. Sales in Russia grew most, 35% respectively.
Profitability was affected by a very fragmented production portfolio where high
number of small size orders caused low production efficiency and high COGS.
NET SALES BY GEOGRAPHICAL SEGMENTS
th EUR % of net sales
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Q2 2013 Q2 2012 Q2 2013 Q2 2012
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Russia 806 598 30.6% 22.8%
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Finland 803 734 30.5% 28.0%
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Estonia 382 405 14.5% 15.5%
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Great Britain 229 312 8.7% 11.9%
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Sweden 146 128 5.5% 4.9%
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Netherlands 51 124 1.9% 4.7%
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Latvia 45 72 1.7% 2.7%
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Ukraine 35 26 1.3% 1.0%
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Lithuania 22 22 0.8% 0.8%
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Germany 18 23 0.7% 0.9%
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India 14 15 0.5% 0.6%
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Other countries 71 72 2.7% 2.7%
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Intragroup 9 90 0.3% 3.4%
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TOTAL 2,631 2,621 100.0% 100.0%
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th EUR Net sales Profit
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Q2 2013 Q2 2012 Q2 2013 Q2 2012
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Pärnu Fibreborad factory 1,091 1,266 (125) (24)
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Püssi Fibreboard factory 889 709 (158) (203)
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Pärnu interior boards factory (Isotex) 642 556 49 60
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Not allocated 9 90 0 0
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TOTAL 2,631 2,631 (234) (167)
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The net sales of the Pärnu Fibreboard factory and interior board's line
decreased 5% in the second quarter of 2013 compared to the same quarter of 2012
and amounted to 1.7 mil. euros. Due to fragmented production portfolio the
production efficiency was low in the second quarter.
The turnover of Püssi fibreboard factory amounted to 889 thousand euros growing
25% compared to the same quarter in 2012 and operating loss amounted to 158
thousand euros (turnover 709 thousand euros and operating loss 203 thousand
euros in Q2 2012). Output of Püssi Fibreboard factory grew in the second
quarter but the main challenge is still to secure Püssi Fibreboard factory with
sufficient sales volumes. In the second quarter Püssi factory was operated at
70-80% of its capacity.
It is also important to note that due to high fixed costs, the factory must be,
for a profitable outcome, operated at as high capacity as possible, which shall
ensure a lower average cost of the product.
SKANO FURNITURE
FURNITURE RETAIL SALES
Skano Group AS retail business is operated by a private limited company Skano
Furniture OÃ and its subsidiaries in Latvia, Lithuania and Ukraine. Skano has
totally 9 stores in Tallinn (2), Pärnu, Riga, Vilnius, Kiev (2), Kharkiv and
Dnipropetrovs'k at the end of the second quarter in 2013.
RETAIL SALES BY COUNTRIES
th EUR % of net sales Number of stores
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Q2 2013 Q2 2012 Q2 2013 Q2 2012 30.06.13 30.06.12
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Estonia 308 261 49.8% 45.9% 3 3
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Latvia 67 82 10.8% 14.4% 1 1
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Lithuania 143 64 23.1% 11.2% 1 1
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Ukraine 101 162 16.3% 28.5% 4 4
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TOTAL 619 569 100.0% 100.0% 9 9
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The furniture retail sale amounted to 619 thousand euros in the second quarter
of 2013 and operating loss 3 thousand euros (sales 569 thousand euros and
operating profit 63 thousand euros in Q2 2012). Retail sale increased in
Estonia and Lithuania but decreased in Latvia and Ukraine (-38% in Ukraine
compared to the same period in 2012). In Ukraine the store in Donetsk was
closed due to poor performance and a new store in Kiev was opened instead.
FURNITURE PRODUCTION
The net sales of the Skano Furniture Factory in the second quarter amounted to
1.8 mil. euros and operating profit to 133 thousand euros. In the same period
last year, the turnover of the factory amounted to 2.1 mil. euros and the
profit to 238 thousand euros. As compared to the previous year the turnover of
the factory has decreased 234 thousand euros and the operating profit has
decreased 105 thousand euros. Sales in the second quarter of 2013 decreased in
all regions (except for sales to the subsidiary) due to weak demand of foreign
markets. In the second quarter the sales in Finland decreased the most (-28%)
due to significantly deteriorated economic situation.
FURNITURE FACTORY SALES BY COUNTRIES
th EUR % of net sales
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Q2 2013 Q2 2012 Q2 2013 Q2 2012
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Russia 830 882 45.3% 42.6%
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Finland 601 835 32.8% 40.3%
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Kazakhstan 38 40 2.1% 1.9%
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Estonia 14 10 0.8% 0.5%
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Other countries 12 14 0.7% 0.7%
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Subsidiaries 335 289 18.3% 14.0%
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TOTAL 1,831 2,070 100.0% 100.0%
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FORECAST AND DEVELOPMENT
SKANO FIBREBOARD. The main production line of Pärnu Fibreboard factory was
operating at full capacity in July 2013 and is expected to be fully utilized in
the third quarter of 2013 according to the management forecast. Production
lines of Isotex interior finishing boards are operated at a normal capacity.
Püssi Fibreboard factory was also operating at full capacity in July 2013 and
according to the management forecast will continue operating at full power
throughout the third quarter except for 3-weeks collective vacation and yearly
planned maintenance repair in the second half of August. According to the
forecast the sales of Skano Fibreboard in the third quarter will exceed the
sales of last year.
In spite of weak demand of foreign markets and economic situation in Europe we
are optimistic about sales growth for H2 2013, mostly from Russia and Finland.
Russia's sales volumes have been growing steadily over the past years and we
expect this to continue in H2 2013. Decrease of our sales in Finland and in
other regions in the first half was mostly caused by deteriorated economic,
which we don't expect to improve during 2013. Despite of stagnation in Finland
we hope due to a new distribution partner and a strategic cooperation agreement
to increase sales in Finland. We also expect this to help our Pärnu and Püssy
factories to reach higher capacity utilization and as a result of this, expect
the whole production process to become more efficient, lead to lower average
production price and higher sales volumes in H2 2013.
SKANO FURNITURE RETAIL SALES. We expect retail sale in the third quarter of
2013 to exceed slightly the sale of last year primarily due to steady growth in
the Baltics.
SKANO FURNITURE FACTORY. In the third quarter of 2013 we expect small decrease
in sales of the furniture factory compared to the same period in 2012 because
of the deteriorated economic situation in the near region and especially in
Finland. For the second half of 2013 we expect small support from sales to new
markets and namely to Great Britain. Additional sales still won't compensate
the sales shortage from Finland. In addition to Great Britain we also seek for
possibilities to enter into other markets of Western Europe.
SKANO GROUP AS. On the 13th of August at the Extraordinary General Meeting,
according to the restructuring plan, increase of share capital of newly
established subsidiaries Skano Furniture Factory OÃ and Skano Fibreboard OÃ by
non-monetary contribution was approved. The object of the non-monetary
contribution is the set of assets of the fibreboard and furniture production
units. Skano Group AS will transfer the production unites of fibreboard and
furniture into separate subsidiaries. The non-monetary contribution shall be
finalised 01.09.2013 by the latest. Starting from September the main
activities, production of fibreboard and furniture, are operated under separate
subsidiaries, in Skano Fibreboard OÃ and Skano Furniture Factoru OÃ
respectively. Skano Group AS will remain as a holding company.
FINANCIAL HIGHLIGHTS
th EUR 6 m 2013 6 m 2012 6 m 2011
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Income statement
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Revenue 9,098 9,440 8,336
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EBITDA 86 511 719
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EBITDA margin 0.9% 5.4% 8.6%
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Operating profit (370) 10 427
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Operating margin (4.1%) 0.1% 5.1%
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Net profit (486) (134) 373
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Net margin (5.3%) (1.4%) 4.5%
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Balance sheet (30.06)
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Total assets 15,256 16,050 13,467
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Return on assets (3.2%) (0.8%) 2.8%
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Equity 7,009 7,532 5,716
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Return on equity (6.9%) (1.8%) 6.5%
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Debt-to-equity ratio 54.1% 53.1% 57.6%
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Share (30.06)
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Closing price 1.06 1.31 1.74
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Earnings per share (0.11) (0.03) 0.08
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Price-earnings ratio (9.64) (43.67) 21.75
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Book value of a share 1.56 1.67 1.27
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Market to book ratio 0.68 0.78 1.37
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Market capitalization 4,769 5,894 7,828
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EBITDA = Earnings before interest, taxes, depreciation and amortization
EBITDA margin = EBITDA / Revenue
Operating margin = Operating profit / Revenue
Net margin = Net profit / Revenue
Return on assets = Net profit / Total assets
Return on equity = Net profit / Equity
Debt-to-equity ratio = Liabilities / Total assets
Earnings per share = Net profit / Total shares
Price-earnings ratio = Closing price / Earnings per share
Book value of a share = Equity / Total shares
Market to book ratio = Closing price / Book value of a share
Market capitalization = Closing price * Total shares
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
th EUR 30.06.2013 31.12.2012 30.06.2012
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Cash and bank 111 158 174
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Receivables and prepayments (Note 1) 1,942 1,792 2,116
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Inventories (Note 2) 3,257 3,303 3,268
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Total current assets 5,310 5,253 5,558
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Investment property (Note 3) 185 185 185
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Tangible fixed assets (Note 4) 9,741 10,010 10,294
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Intangible fixed assets (Note 5) 20 23 13
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Total fixed assets 9,946 10,218 10,492
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TOTAL ASSETS 15,256 15,471 16,050
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Debt obligations (Note 6) 1,249 1,845 1,277
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Payables and prepayments (Note 7) 2,419 1,923 2,507
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Short-term provisions (Note 8) 7 12 5
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Total current liabilities 3,675 3,780 3,789
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Non-current debt obligations (Note 6) 4,328 3,973 4,490
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Non-current provisions (Note 8) 244 236 239
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Total non-current liabilities 4,572 4,209 4,729
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Total liabilities 8,247 7,989 8,518
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Share capital at nominal value (Note 9) 2,699 2,699 2,699
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Issue premium 364 364 364
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Statutory capital reserve 288 288 288
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Currency translation (8) (21) (38)
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Retained profits 4,152 4,353 4,353
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Net profit (loss) for the year (Note 10) (486) (201) (134)
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Total equity 7,009 7,482 7,532
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TOTAL LIABILITIES AND EQUITY 15,256 15,471 16,050
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CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME
th EUR 2nd Q 2013 2nd Q 2012 6 m 2013 6 m 2012
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RETURN ON SALES (Note 11) 4,736 4,881 9,098 9,440
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Cost of production sold (3,999) (4,007) (7,841) (7,941)
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Gross profit 737 874 1,257 1,499
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Marketing expenses (649) (592) (1,229) (1,192)
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General administrative expenses (180) (199) (387) (309)
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Other income 19 54 61 91
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Other expenses (31) (29) (72) (79)
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Operating profit (loss) (Note 11) (104) 108 (370) 10
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Financial income and financial (60) (67) (115) (134)
expenses
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Profit (loss) before taxes (164) 41 (485) (124)
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Prepaid income tax 0 (2) (1) (10)
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NET PROFIT (LOSS) FOR THE PERIOD (164) 39 (486) (134)
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Basic earnings per share (Note 10) (0.04) 0.01 (0.11) (0.03)
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Diluted earnings per share (Note 10) (0.04) 0.01 (0.11) (0.03)
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Other comprehensive income:
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Currency translation differences 3 (36) 13 (27)
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TOTAL COMPREHENSIVE INCOME (161) 3 (473) (161)
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The planned time of publishing of interim report of the third quarter 2013 is
week 48 (25-29 November 2013)
Martin Kalle
CF0
+372 4478 331
martin.kalle@skano.com
www.skano.com
News Source: NASDAQ OMX
23.08.2013 Dissemination of a Corporate News, transmitted by DGAP -
a company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Language: English
Company: Skano Group
Estonia
Phone:
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ISIN: EE3100092503
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