- ISIN EE3100092503
Skano Group
Financial result, 9 months 2012
Skano Group
16.11.2012 15:06
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Pärnu, Estonia, 2012-11-16 15:06 CET (GLOBE NEWSWIRE) --
THIRD QUARTER IN SHORT
Consolidated net sales of the third quarter of 2012 was 4.7 mil. euros,
representing a 13% increase on the third quarter compared to the same period in
2011. At the same time, consolidated EBITDA amounted to 351 thousand euros (179
thousand euros in Q3 2011 without the gain from a bargain purchase of Püssi
softboard factory).
The sales in Pärnu fibreboard factory and of Isotex internal finishing boards
increased as compared to the respective period last year by 8%, the operating
profit 10% and operating profit amounted to 228 thousand euros.
The turnover of Püssi softboard factory was 799 thousand euros and operating
loss 230 thousand euros. The sales increased by 13% compared to the previous
quarter. The priority of the management of the enterprise is continuously to
ensure the sales of the production of Püssi softboard factory in order to
guarantee the maximum production capacity and efforts are taken in this
direction on an on-going basis. In addition to efforts regarding the sales
volumes we are constantly working on raising the production efficiency of the
factory. We have raised the maximum speed of the production line and thereby
lowered the cost price of products. In October, the average cost price of
products was approximately 18% lower than the average of the third quarter.
Such increase of efficiency decreases the loss in case of low production
volumes whereas the full effect appears when the sales volumes have grown.
The turnover of the furniture factory decreased by 14% and the operating profit
by 55% as compared to the same period last year, and the operating profit was
58 thousand euros.
The turnover of furniture retail chain increased by 24% as compared to the same
period last year being 555 thousand euros and the operating profit was 3
thousand euros. 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 third quarter 2012 was 4.7 mil. euros (4.2 mil. euros
in same period of 2011) representing a 13% increase on the third quarter
compared to Q3 2011. The Group's gross margin in the third quarter of 2012 was
15.9% compared to 14.4% in the third quarter of 2011. Consolidated operating
profit amounted to 0.1 mil. euros (0.01 mil. euros from main activities in same
period 2011, totally 2.5 mil. euros with the gain from a bargain purchase of
Püssi factory). The consolidated operating margin of net sales was 2.3% (0.3%
from main activities and totally 59.1% in Q3 2011).
Consolidated net profit amounted to 44 thousand euros (compared to net loss
from main activities 53 thousand euros and total net profit 2,402 thousand
euros in Q3 2011), and the net margin was 0.9% (57.5% in Q3 2011).
POSITION OF FINANCIAL STATEMENT
As of 30.9.2012 the total assets of Skano Group AS amounted to 16.2 mil. euros
(31.12.2011: 16.0 mil. euros). The liabilities of the company accounted for
53.1% (31.12.2011: 51.8%) thereof, i.e. 8.6 mil. euros (31.12.2011: 8.3 mil.
euros).
Receivables and prepayments have increased by 0.5 mil. euros i.e. 33% increase
with 9 months. The reason of increase of receivables is small sales in December
2011, which essentially lowered the amount of receivables at the end of
December.
Inventories increased by 0.3 mil. euros to reach 3.4 mil. euros on 30.9.2012.
(31.12.2011: 3.2 mil. euros). Property, plant and intangibles decreased by 0.5
mil. euros mainly as a result of depreciation.
Short-term loans decreased by 0.5 mil. euros and amounted to 0.9 mil. euros in
30.9.2012 (31.12.2011: 1.4 mil. euros) as a result of re-classification into
long-term loans. Supplier payables, tax liabilities, other payables, including
payables to employees, and provisions amounted to 2.6 mil. euros (31.12.2011:
2.1 mil. euros). Current and non-current liabilities increased by 0.3 mil.
euros to 8.6 mil. euros (31.12.2011: 8.3 mil. euros).
DIVISIONAL REVIEW
NET SALES BY BUSINESS SEGMENTS
----------------------------
th EUR % of net sales
-----------------------------------
Q3 2012 Q3 2011 Q3 2012 Q3 2011
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Building Materials Division 2,964 2,309 63.0% 55.3%
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Furniture Factory 1,399 1,626 29.7% 38.9%
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Retail sales of furniture 555 448 11.8% 10.7%
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Elimination (210) (206) (4.5%) (4.9%)
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TOTAL 4,708 4,177 100.0% 100.0%
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NET SALES BY GEOGRAPHICAL SEGMENTS
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th EUR % of net sales
-----------------------------------
Q3 2012 Q3 2011 Q3 2012 Q3 2011
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Russia 1,487 1,158 31.6% 27.7%
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Finland 1,046 1,518 22.2% 36.3%
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Estonia 754 734 16.0% 17.6%
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Great Britain 334 173 7.1% 4.1%
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Ukraine 229 149 4.9% 3.6%
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Latvia 207 97 4.4% 2.3%
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Nederland 176 0 3.7% 0.0%
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Lithuania 146 101 3.1% 2.4%
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Sweden 143 103 3.0% 2.5%
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Kazakhstan 36 9 0.8% 0.2%
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Germany 34 31 0.7% 0.7%
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India 22 0 0.5% 0.0%
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Denmark 15 23 0.3% 0.6%
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China 0 10 0.0% 0.2%
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Other countries 79 71 1.7% 1.7%
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TOTAL 4,708 4,177 100.0% 100.0%
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Regarding the markets, turnover has increased in Russia UK, Latvia and
Nederland. The percentage of turnover has decreased in most in Finland.
PROFIT BY BUSINESS SEGMENTS
th EUR Q3 2012 Q3 2011
---------------------------------------------
Furniture Factory 58 129
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Retail sales of furniture 3 (1)
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Building Materials Division 25 2,357
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Elimination 23 -19
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TOTAL 109 2,466
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Net financial costs (62) (64)
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Income tax (3) (0)
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NET PROFIT 44 2,402
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BUILDING MATERIALS DIVISION
The net sales of the Building Materials Division in the third quarter of 2012
amounted to 3.0 mil. euros and profit to 25 thousand euros. In the same period
last year, the turnover of the division totaled to 2.3 mil. euros and the loss
from main activities 98 thousand euros. The profit including the gain from a
bargain purchase from Püssi factory amounted to 2,357 thousand euros. As
compared to the previous year the turnover of the division has increased by 655
thousand euros (28%). The growth of sales came from production of Püssi
softboard factory.
NET SALES BY GEOGRAPHICAL SEGMENTS
----------------
th EUR % of net sales
-----------------------------------
Q3 2012 Q3 2011 Q3 2012 Q3 2011
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Russia 804 426 27.1% 18.4%
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Finland 602 848 20.3% 36.7%
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Estonia 544 537 18.4% 23.3%
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Great Britain 334 173 11.3% 7.5%
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Nederland 176 0 5.9% 0.0%
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Latvia 144 43 4.9% 1.9%
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Sweden 143 103 4.8% 4.5%
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Lithuania 50 9 1.7% 0.4%
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Ukraine 34 26 1.1% 1.1%
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Germany 34 31 1.1% 1.3%
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India 22 0 0.7% 0.0%
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Denmark 15 23 0.5% 1.0%
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Other countries 62 90 2.1% 3.9%
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TOTAL 2,964 2,309 100.0% 100.0%
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The biggest growth has been in sales to Great Britain, Russia and Nederland.
The percentage of sales into Finland and Estonia decreased remarkably. Despite
of the remarkable growth of sales, profit of division decreased. Instead of one
softboard production unit the company operates now with two.
------------------------------
th EUR Net sales Profit
-----------------------------------
Q3 2012 Q3 2011 Q3 2012 Q3 2011
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Pärnu softboard factory 1,347 1,359 125 199
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Püssi softboard factory 799 323 (230) 2,091
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Pärnu interior boards factory 707 551 103 54
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Not allocated 110 77 27 13
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TOTAL 2,964 2,309 25 2,357
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The net sales of the Pärnu softboard factory and interiors boards line
increased 8% in the third quarter of 2012 compared to the same quarter of 2011
and amounted to 2.1 mil. euros.
The turnover of Püssi fibreboard factory amounted to 799 thousand euros and
operating loss amounted to 230 thousand euros. The company continues
negotiations with several clients, the conclusion of large delivery contracts
and reaching higher sales volumes takes time. Although in the fourth quarter of
the previous year Püssi factory reached a position to guarantee a sufficient
volume, security of supply and quality for corporate clients without taking big
risks, the attainment of actual greater amounts of supplies has taken longer
than expected due to the general uncertainty in the economic environment in
Europe, as well as a relatively lengthy procurement processes of bigger retail
chains. Today Püssi factory is operating at approximately of 70% of its
capacity and it is difficult to make exact prognosis about the increase of
production volume due to instability in the world.
It is also important to note that due to high fixed costs, the factory shall,
for a profitable outcome, be operated at as high capacity as possible, which
shall ensure a lower average cost price of the product.
Presently, the cost price considerably higher than the optimum is greatly
caused by technological standstills and reconstruction of equipment in order to
ensure better efficiency. Thereby we have achieved a cost level by the present
day in which the average cost price of production in October was 18% lower than
the average of the third quarter. At the same time there is still a significant
reserve regarding the further decrease of cost price within the following
quarters.
We are still confident that purchasing of the Püssi was a very good decision in
the medium term and after introducing of significant technological and
procedural changes in the factory we succeed in reducing the cost price more
than we had expected before the purchase of the factory.
FURNITURE DIVISION
FURNITURE RETAIL SALES
Skano Group AS retail business is operated by a private limited company Skano
Furniture OÜ and its subsidiaries in Latvia, Lithuania and Ukraine. Skano has
totally 9 stores in Tallinn (2), Pärnu, Riga, Vilnius, Kiev, Donetsk, Kharkiv
and Dnipropetrovs'k at the end of the third quarter.
RETAIL SALES BY COUNTRIES
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th EUR % of net sales Number of stores
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Q3 2012 Q3 2011 Q3 2012 Q3 2011 30.09.12 30.09.11
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Estonia 201 178 36.2% 39.7% 3 3
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Latvia 63 54 11.4% 12.1% 1 1
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Lithuania 96 92 17.3% 20.5% 1 1
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Ukraine 195 124 35.1% 27.7% 4 6
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TOTAL 555 448 100.0% 100.0% 9 11
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The furniture retail sale has reached to the profitable sales level, and it
results with profit 3 thousand euros in third quarter 2012. Loss from currency
exchange rate of hryvnia was 26 thousand euros.
FURNITURE PRODUCTION
The net sales of the Furniture Factory in the third quarter amounted to 1.4
mil. euros and profit to 58 thousand euros. In the same period last year, the
turnover of the factory totalled to 1.6 mil. euros and the profit 129 thousand
euros. As compared to the previous year the turnover of the factory has
decreased 227 thousand euros and the profit has decreased 71 thousand euros.
The results of third quarter are influenced by the collective vacations in
July.
FURNITURE FACTORY SALES BY COUNTRIES
----------------
th EUR % of net sales
-----------------------------------
Q3 2012 Q3 2011 Q3 2012 Q3 2011
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Russia 683 732 48.8% 45.0%
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Finland 444 670 31.7% 41.2%
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Kazakhstan 36 0 2.6% 0.0%
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Estonia 9 18 0.6% 1.1%
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Other countries 17 0 1.2% 0.0%
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Subsidiaries 210 206 15.0% 12.7%
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TOTAL 1,399 1,626 100.0% 100.0%
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FORECAST AND DEVELOPMENT
BUILDING MATERIALS DIVISION. The main production line of Pärnu fibreboard
factory is operating at reduced capacity in the fourth quarter. Production
lines of Isotex interior finishing boards use one or two shifts as necessary.
Due to low demand Püssi factory is operating at approximately of 70% of its
capacity in the fourth quarter of the year 2012.
FURNITURE RETAIL SALES. We expect growth of retail sale in the fourth quarter
of 2012 compared to previous quarter.
FURNITURE FACTORY. In the fourth quarter of 2012 we shall plan increase in
turnover of the furniture factory as compared to the third quarter since the
period of Q3 included the collective vacation of the factory. Compared to the
fourth quarter last year, the sales amount will decrease.
FINANCIAL HIGHLIGHTS
th EUR 9 m 2012 9 m 2011 9 m 2010
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Income statement
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Revenue 14,148 12,513 9,875
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EBITDA 862 3,353 1017
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EBITDA margin 6.1% 26.8% 10.3%
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Operating profit 119 2,893 644
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Operating margin 0.8% 23.1% 6.5%
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Net profit (90) 2,775 562
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Net margin (0.6%) 22.2% 5.7%
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Balance sheet (30.9)
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Total assets 16,201 16,538 9,104
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Return on assets (0.6%) 16.8% 6.2%
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Equity 7,602 7,693 5,129
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Return on equity (1.2%) 36.1% 11.0%
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Debt-to-equity ratio 53.1% 53.5% 43.7%
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Share (30.9)
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Closing price 1.37 1.50 1.15
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Earnings per share (0.02) 0.62 0.12
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Price-earnings ratio - 2.42 9.21
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Book value of a share 1.69 1.76 1.14
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Market to book ratio 0.81 0.85 1.01
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Market capitalization 6,164 6,749 5,174
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EBITDA = Earnings before interest, taxes, deprecation 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 30.9.2012 31.12.2011 30.9.2011
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Cash and bank 179 206 160
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Receivables and prepayments 2,219 1,674 2,261
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Inventories 3,448 3,177 3,100
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Total current assets 5,846 5,057 5,521
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Investment property 185 185 185
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Tangible fixed assets 10,158 10,692 10,815
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Intangible fixed assets 12 16 17
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Total fixed assets 10,355 10,893 11,017
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TOTAL ASSETS 16,201 15,950 16,538
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Debt obligations 880 1,380 659
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Payables and prepayments 2,579 2,137 2,692
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Short-term provisions 3 11 1
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Total current liabilities 3,462 3,528 3,352
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Non-current debt obligations 4,898 4,490 5,067
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Non-current provisions 239 239 198
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Total non-current liabilities 5,137 4,729 5,265
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Total liabilities 8,599 8,257 8,617
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Share capital at nominal value 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 (11) (11) 7
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Retained profits 4,353 1,788 1,788
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Net profit (loss) for the year (61) 2,565 2,775
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Total equity 7,602 7,693 7,921
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TOTAL LIABILITIES AND EQUITY 16,201 15,950 16,538
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
th EUR 3rd q 2012 3rd q 2011 9 m 2012 9 m 2011
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RETURN ON SALES 4,708 4,176 14,148 12,513
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Cost of production sold (3,961) (3,573) (11,901) (10,022)
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Gross profit 747 603 2,247 2,491
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Marketing expenses (559) (516) (1,752) (1,700)
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General administrative expenses (76) (102) (385) (349)
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Other income* 40 2,500 131 2,562
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Other expenses (43) (19) (122) (111)
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Operating profit 109 2,466 119 2,893
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Financial income and financial (62) (64) (197) (114)
expenses
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Profit (loss) before taxes 47 2,402 (78) 2,779
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Prepaid income tax (3) 0 (13) (4)
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NET PROFIT (LOSS) FOR THE PERIOD 44 2,402 (91) 2,775
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Basic earnings per share 0.01 0.53 (0.02) 0.62
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Diluted earnings per share 0.01 0.53 (0.02) 0.62
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Currency translation differences 27 (21) 0 (9)
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TOTAL COMPREHENSIVE INCOME 71 2,381 (91) 2,766
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*The other income in 2011 includes the gain from a bargain purchase 2,455 th.
EUR.
The planned time of publishing of interim report of fourth quarter 2012 is week
9 (25. - 28. February 2013).
Einar Pähkel
CFO
+372 447 8331
einar.pahkel@skano.com
www.skano.com
News Source: NASDAQ OMX
16.11.2012 Dissemination of a Corporate News, transmitted by DGAP -
a company of EquityStory 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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E-mail:
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ISIN: EE3100092503
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