WULFF GROUP PLC
FINANCIAL STATEMENTS RELEASE
February 9, 2011 at 9:00 A.M.
WULFF GROUP PLC’S FINANCIAL STATEMENTS FOR JANUARY 1 – DECEMBER 31, 2010
- Net sales in the last quarter totalled EUR 27.1 million with an increase of 5.2 percentages from the comparable period last year (EUR 25.7 million). Net sales for the year (EUR 93.1 million) increased by 24.5 percentages from previous year (EUR 74.8 million). The markets have turned up in the late 2010.
- EBITDA in the last quarter was EUR 1.3 million being 56 percentages higher than in the comparable period (EUR 0.8 million). The whole year’s EBITDA was EUR 1.6 million i.e. EUR 0.3 million (26 percentages) greater than in the previous year (EUR 1.2 million).
- In the last quarter 2010, the operating profit of EUR 0.9 million was 159 percentages greater than in the comparable period (EUR 0.35 million). The operating result for the whole year turned slightly to a profit of EUR 0.04 million whereas in the previous year, the operating result was a loss of EUR 0.15 million.
- In the last quarter, the operating cash flow amounted to EUR 3.2 million (EUR 1.2 million).
- The 12-month result after financial items and taxes remained still negative. Earnings per share were EUR -0.10 (EUR -0.11) for the whole year and EUR +0.05 (EUR +0.03) for the last quarter.
- The Board of Directors proposes a dividend of EUR 0.05 per share to be distributed (EUR 0.05 per share).
GROUP’S NET SALES AND PERFORMANCE
Net sales in the last quarter totalled EUR 27.1 million with an increase of 5.2 percentages from the comparable period last year (EUR 25.7 million). Net sales for the year (EUR 93.1 million) increased by 24.5 percentages from previous year (EUR 74.8 million).
Wulff Group’s CEO Heikki Vienola: “I am satisfied with the sales increase in 2010. The turn-up of the markets and our new customer-oriented solutions under development create possibilities for a positive improvement. Customer orientation has guided our operations already for more than 120 years and it will be one of our key success factors in the future as well when we will serve our customers in a even broader and common way following our customers’ wishes. Even closer cooperation between our group companies and taking constantly advantage of new synergies play also important roles in our future operations”.
EBITDA in the last quarter was EUR 1.3 million being 56 percentages higher than in the comparable period (EUR 0.8 million). The whole year’s EBITDA was EUR 1.6 million i.e. EUR 0.3 million (26 percentages) greater than in the previous year (EUR 1.2 million). The Group continues to review its cost structure and performance efficiency with a focus on improving the profitability of all its businesses.
In October-December, the operating profit of EUR 0.9 million was 159 percentages greater than in the comparable period (EUR 0.35 million). The operating profit was 3.3 percentages (1.4 %) of the last quarter’s net sales. The operating result for the whole year turned slightly to a profit of EUR 0.04 million whereas in the previous year, the operating result was a loss of EUR 0.15 million. The operating profit was 0.0 percentages (-0.2 %) of the annual net sales. The goodwill arising from the acquisition of Entre Marketing Oy, the Group’s fair and event marketing company, was impaired by EUR 0.35 million in 2010 and by EUR 0.18 million in 2009.
In 2010, the financial income and expenses totalled (net) EUR +0.18 million (EUR -0.21 million) including dividend income of EUR 0.15 million, interest expenses of EUR 0.27 million and other financial items (net) of EUR +0.31 million. For the last quarter, the net financial income and expenses were EUR -0.11 million
(EUR -0.05 million).
Profit before taxes increased by 165 percentages up to EUR 0.79 million (EUR 0.30 million) in the last quarter. Also the annual result before taxes turned up to a profit of EUR 0.22 million (EUR -0,36 million).
In the last quarter, the net profit attributable to the equity holders of the parent company amounted to EUR 0.31 million (EUR 0.22 million) but the annual result remained still negative at EUR -0.62 million
(EUR -0.73 million). Earnings per share for the last quarter (EUR 0.05) was better than in the comparable period (EUR 0.03) but the annual earnings per share (EUR -0.10) remained on previous year’s level
Return on investment (ROI) was +3.18 percentage (+1.48 %) for the last quarter and +1.75 percentage (+0.20 %) for the year. Return on equity (ROE) was +2.07 percentage (+1.33 %) for the last quarter and
-2,38 percentage (-3.46 %) for the year.
CONTRACT CUSTOMERS DIVISION
The Contract Customers Division is a comprehensive partner for customers in the field of office supplies, business and promotional gifts as well as fair and event marketing services. In 2010, the segment’s annual net sales increased by EUR 20.0 million i.e. 35 percentages up to EUR 77.3 million (EUR 57.3 million) due to Wulff Supplies which has been consolidated since the beginning of August 2009 in the Contract Customer Division. In October–December, the division’s net sales totalled EUR 22.4 million (EUR 21.7 million).
With operations in Scandinavia, Wulff Supplies has managed to both increase its market share and win new customers constantly. The new efficient logistic centre opened in Ljungby, Southern Sweden, in the summer 2010, enables better customer service and future growth. Also several development initiatives bring cost savings in the operations. The integration of Wulff Supplies with Wulff Group has continued successfully. The Group has good possibilities to serve even more Nordic customers in the future. The Nordic cooperation and the synergies, in purchases for example, give the customers even more competitive products and services.
During the past 120 years, Wulff Oy is known for being the pioneer in its branch in Finland. In 2010, Wulff invested remarkably in the launch, development and marketing of the new webstore Wulffinkulma.fi. There are many innovative ways to sell the webstore concept to customers, for example e-marketing is supported with the sales activities of Group’s qualified direct sales persons. Personal sales activities are targeted to reach also those customers who have not yet made active purchases in the web. Constantly during the year, the webstore has brought new customers which will support the Group’s growth. To strengthen its status as the industry’s e-commerce pioneer, Wulff continues to take strong efforts in the constant development and marketing of the webstore also in 2011. The webstore serves its customers with a product range of nearly 4,000 products.
In 2010, the division’s operating profit excluding the one-time goodwill impairment expenses totalled EUR 0.83 million and was greater than the operating profit of EUR 0.66 million in 2009. For the last quarter, the division’s operating profit excluding the one-time goodwill impairment (EUR 0.86 million) was clearly better than in the comparable period 2009 (EUR 0.47 million). From the goodwill of Entre Marketing Oy, the Group’s fair and event marketing company, a non-recurring impairment of EUR 0.35 million was expensed in 2010 (EUR 0.18 million). Operating profit including the non-recurring impairment amounted to EUR 0.48 million (EUR 0.48 million) in 2010 and EUR 0.86 million (EUR 0.29 million) in the last quarter.
The economic slowdown has impacted especially the demand for business and promotional gifts. Historically the demand for business and promotional gifts is greatest during the Christmas season in the last quarter. The improvement of the economic situation increases also the demand for business and promotional gifts, and especially the good Christmas season in Estonia indicates the improvement of the business and promotional gift markets.
In the autumn 2010, there were management changes in the division when Jani Puroranta was nominated as Wulff Oy’s Managing Director and Juha Broman as the Managing Director of Wulff Oy’s subsidiary Torkkelin Paperi Oy, which is located in Lahti, Finland.
DIRECT SALES DIVISION
The Direct Sales Division aims to improve its customers’ daily operations with innovative products and the industry’s most professional personal, local service. In the last quarter, the division’s net sales (EUR 4.8 million) were EUR 0.53 million i.e. 12 percentages greater than in the comparable period (EUR 4.3 million). In 2010, the division’s net sales (EUR 16.1 million) were lower than in 2009 (EUR 18.0 million) due to the divestment of former group companies Everyman Oy and Officeman Oy which were sold to the minority shareholders in September 2009.
The Direct Sales Division’s operating result turned from the loss up to an operating profit of EUR 0.32 million this year (EUR -0.25 million). In the last quarter, the division’s operating profit of EUR 0.23 million was slightly behind the previous year’s level (EUR 0.28 million).
The division’s organizational changes in 2009 and the improvement of the management practices have affected positively the profit of the Finnish direct sales companies. In order to achieve a good profitability level and financial result, the cost efficiency improvement initiatives will continue in all direct sales companies. Additionally, the focus is in improving the sales and supporting it with new methods, e.g. with e-marketing. In Lithuania, the small direct sales operations started in 2009 were closed in summer 2010.
For a sales company, the most important asset is its personnel. Capable persons make the growth possible and one of the most significant goals for the Direct Sales division is to be able to recruit talented sales professionals. The Group invests in visibility and recruitment marketing in different media and aims to recruit several new direct sales employees in the Nordic countries. The recruiting cooperation with the governmental employment agency is developed constantly. Wulff Academy, the Group’s own training program for its new sales personnel, guarantees the best possible start for the persons who are changing jobs or entering the industry for the first time. Wulff Academy trainees build their career path based on their own talents and development. During the year, the focus was in development of Wulff Academy operations and the new ideas have gained good feedback also in the form of increased sales.
FINANCING, INVESTMENTS AND FINANCIAL POSITION
The cash flow from operating activities totalled EUR 3.16 million (EUR 1.24 million) in the last quarter and EUR 1.53 million (EUR 1.47 million) in the whole year. In addition to the profitability improvement initiatives, the Group aims to improve the working capital management and increase the cash flow from operating activities.
In 2010, a net total of EUR 1.51 million was used in investing activities including investments in intangible and tangible assets (EUR 1.51 million), payment of the additional acquisition price debt related to subsidiary Ibero Liikelahjat Oy (EUR 0.19 million), payment for the acquisition of the subsidiary Entre Marketing Oy’s minority shares (EUR 0.03 million) and proceeds from the disposal of fixed assets (EUR 0.19 million). During the year, investments were made e.g. in Wulff Supplies’ new logistics centre in Ljungby, Sweden as well as in IT development projects in Finland. In the last quarter of 2010, the net investments totalled EUR 0.25 million. In 2009, the net investments amounted to EUR 2.50 million during the whole year and EUR 0.18 million during the last quarter.
The changes in long- and short-term loans totalled a net repayment of EUR 0.47 million in 2010, whereas in 2009 new funding was raised net of EUR 2.50 million for financing the acquisition of Wulff Supplies. The acquisition of own shares totalled EUR 0.11 million (EUR 0.13 million) and the net change in short-term investments amounted to EUR 0.06 million (EUR 0.22 million). Dividends of EUR 0.15 million (EUR 0.01 million) were received. The parent company shareholders were paid dividends of EUR 0.33 million (EUR 0.33 million) and the minority shareholders of the subsidiaries were paid dividends of EUR 0.15 million (EUR 0.09 million). The net cash flow used in financing activities totalled EUR -0.97 million in 2010 (EUR +1.74 million) and EUR -0.31 million (EUR +0.28 million) in the last quarter.
In general, the cash generated in the operations (EUR +1.53 million) was spent mainly for the investments (EUR -1.51 million) and thus, along with the repayments of loans and dividend distribution, the Group’s cash amount decreased by EUR 0.96 million from the beginning value of EUR 5.34 million down to EUR 4.38 million (previous year’s change EUR +0.71 million). In the last quarter, the cash amount increased by EUR 2.59 million (EUR +1.34 million).
The equity attributable to the equity holders of the parent company totalled EUR 2.41 per share (EUR 2.58) and the equity-to-assets ratio was 37.0 percentage (41.7 %).
DECISIONS OF THE ANNUAL GENERAL MEETING
Wulff Group Plc’s Annual General Meeting held on April 23, 2010 decided to pay a dividend of EUR 0,05 per share and authorised the Board of Directors to decide on the repurchase of the company’s own shares. The Annual General Meeting accepted also the Board’s proposal concerning the authorisation to perform share issues.
The Annual General Meeting adopted the financial statements for the financial year 2009 and discharged the members of the Board of Directors and CEO from liability.
Due to a change in the legislation, the Annual General Meeting decided to amend the Articles of Association in a way that the invitations to the General Meetings are delivered at least 21 days prior to the General Meeting, but not later than nine days before the General Meeting record date. The amendment of the Articles of Association was entered in the Finnish Trade Register on June 8, 2010 which was announced in a stock exchange release on the same day. The current Articles of Association are available on the Group’s website www.wulff-group.com.
The previous Board members Ere (Erkki) Kariola, Ari Pikkarainen, Pentti Rantanen, Saku (Sakari) Ropponen and Heikki Vienola were re-elected and Andreas Tallberg was elected as a new member of the Board. The organising meeting of the Board of Directors, held after the Annual General Meeting, decided that the new Chairman of the Board is Saku (Sakari) Ropponen.
The shareholders attending the Annual General Meeting held on April 23, 2010 were informed that Nexia Tilintarkastus Oy, Authorised Public Accountants, and Juha Lindholm, Certified Auditor, continued operating as the Company’s auditors. The new lead auditor nominated by Nexia Tilintarkastus Oy is Christer Antson, Authorised Public Accountant.
In 2011, Wulff Group Plc’s Annual General Meeting will be held on Thursday April 28, 2011. A separate notice to the Annual General Meeting will be published prior to the meeting.
SHARES AND SHARE CAPITAL
Based on the authorization of the Annual General Meeting held on April 24, 2009, the acquisition of own shares continued in 2010. In the end of December 2009, the parent company held a total of 69 022 own shares and in the first quarter of 2010, 2 807 own shares were repurchased and 5 000 own shares were allocated to the Group’s key person as a part of the share-based incentive plan decided in 2008. In the end of March 2010, the Group held a total of 66 829 own shares (24 956 as of March 31, 2009) representing 1.0 percentage (0.4 %) of the total number and voting rights of Wulff shares. The average price for the own shares repurchased in January-March was EUR 3.25 per share.
Authorized by the Annual General Meeting held on April 23, 2010, the Board of Directors decided in its organizing meeting to continue buying back a maximum of 300,000 own shares by the next Annual General Meeting. The reacquisition of own shares continued in May and in the end of December 2010 the Group held 99,036 own shares (69,022 shares as of December 31, 2009) which represents 1.5 percentage (1.0 %) of the total number and voting rights of Wulff shares. The average price for the own shares repurchased in 2010 was EUR 3.16 per share.
The shares are acquired through public trading on NASDAQ OMX Helsinki in a proportion other than that of current shareholder holdings. The shares are acquired at the market price quoted at the time of the repurchase in accordance with the rules regarding the acquisition of company’s owns shares. According to the authorisation, the treasury shares can be acquired to carry out acquisitions or other business related arrangements, to improve the company’s capital structure, to support the implementation of the company’s incentive scheme or to be cancelled or disposed of. The Group does not have any option schemes currently in force. The parent company’s share capital (EUR 2.65 million) consists of 6 607 628 shares with one vote each. There have been no changes in share capital in 2009 and 2010. There have been no disclosed notifications on changes in major holdings during 2009 and 2010. Wulff Group Plc’ share is listed on NASDAQ OMX Helsinki in the Small Cap segment under the Consumer Discretionary sector. The company’s trading code is WUF1V. In 2010, a total of 261,633 (292,139) Wulff shares were traded which represents 4.0 percentages (4.4 %) of the total number of shares. The trading was worth of EUR 793.852 (EUR 752.344). In 2010, the highest share price was EUR 3.70 (EUR 4.02) and the lowest price was EUR 2.43 per share (EUR 2.00). In the end of 2010, the share was valued at EUR 2.60 (EUR 3.20 as of December 31, 2009) and the market capitalization of the outstanding shares totalled EUR 16.9 million (EUR 20.9 million as of December 31, 2009).
BOARD OF DIRECTORS’ DIVIDEND PROPOSAL
The parent company’s distributable funds total EUR 4.21 million. The Group’s net result for 2010 was EUR -0.62 million i.e. EUR -0.10 per share (EUR -0.11 per share). The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.05 per share (EUR 0.05 per share) will be distributed, which makes a total dividend of EUR 0.33 million. At the date of the dividend distribution, the own shares held by the Company are not paid any dividend. The remaining distributable funds of EUR 3.88 million will be retained in the shareholders’ equity.
In 2010, the Group’s personnel totalled 384 (392) employees on average. In the end of the year, the Group had 370 (372) employees of which 132 (115) persons were employed in Sweden, Norway, Denmark and Estonia. The operations in Lithuania were closed down in summer 2010.
The majority, over 60 percentages of the Group’s personnel works in sales operations and almost 40 percentages of the employees work in logistics and administration. Wulff employees equally both genders: in the end of 2010, men represented 52 percentages and women 48 percentages of the employees.
In order to increase the organic growth, the Group focuses on recruiting sales personnel. The Group continues the close cooperation with the employment authorities and the educational institutions. Along with the web-based recruitment methods, the Group participates different events and takes personal contact with potential sales talents. The Group aims to increase its sales personnel in all its operational countries in 2011.
RISKS AND UNCERTAINTIES IN THE NEAR FUTURE
The economic downturn in the Nordic countries has clearly affected the demand for office supplies. The general uncertainty may continue which will most likely affect the ordering behaviour of some corporate clients also in early 2011. The improvement of the economic situation is expected to affect quickly the demand for office supplies.
The possibly ongoing economic slowdown impacts especially the demand for business and promotional gifts. Although the business gifts are seen increasingly as a part of the corporate communications as a whole and they are utilized also in the off-season, some cost savings may be sought after by decreasing the investments in the brand promotion. In the economic downturn, the corporations also minimize attending fairs and decrease their event marketing activities.
MARKET SITUATION AND OUTLOOK FOR 2011
Wulff is the most significant Nordic player in its industry. Wulff’s mission is to help its corporate customers to succeed in their own business by providing them with leading-edge products and services in a way best suitable to them. The Nordic markets have been consolidating when – in addition to Wulff itself – also other international players have acquired Nordic office supply companies lately: Staples acquired Oy Lindell Ab in July 2010, Lyreco acquired Officeday Finland Oy from Arion bank in August 2010 and Office Depot acquired Swedish Frans Svanström & Co Ab in January 2011.
In 2011, the Group continues taking actions for enhancing profitability. The Group focuses on the growth and development of its sales operations. In 2011, the Group expects to win new customers and gain growth especially along with Wulff Supplies Ab in Scandinavia and with the webstore Wulffinkulma.fi in Finland.
The group management believes that in 2011 Wulff has good opportunities to reach an operating result better than in 2010 as long as the markets continue improving also in 2011 as has been experienced since the last quarter 2010. Wulff is also prepared to carry out new strategic acquisitions.
MEETING FOR INVESTORS AND ANALYSTS
Wulff Group Plc arranges a meeting for investors and analysts today on February 9, 2011 at noon (12.00) at restaurant Mamma Rosa, Runeberginkatu 55, Helsinki, Finland.
FINANCIAL REPORTING IN 2011
Wulff Group Plc will release the following financial reports in 2011:
|Annual Report 2010||Week 12|
|Interim Report, January-March 2011||Friday May 6, 2011 at 9.00 A.M.|
|Interim Report, January-June 2011||Wednesday August 10, 2011 at 9.00 A.M.|
|Interim Report, January-September 2011||Thursday November 10, 2011 at 9.00 A.M.|
Wulff Group Plc’s financial reports are published in Finnish and in English, and they are available at the Group’s website www.wulff-group.com.
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
|Net sales||27 073||25 724||93 107||74 785|
|Other operating income||94||62||467||402|
|Materials and services||-17 384||-17 180||-60 516||-45 445|
|Employee benefit expenses||-5 071||-4 491||-18 617||-15 980|
|Other operating expenses||-3 429||-3 291||-12 866||-12 515|
|EBITDA||1 284||824||1 575||1 247|
|Depreciation and amortization||-381||-295||-1 182||-940|
|Profit/Loss before taxes||794||300||223||-360|
|Net profit/loss for the period||347||239||-415||-644|
|Equity holders of the parent company||308||219||-623||-728|
|Earnings per share for profit|
|attributable to the equity holders|
|of the parent company:|
|Earnings per share, EUR||0,05||0,03||-0,10||-0,11|
|(diluted = non-diluted)|
|STATEMENT OF COMPREHENSIVE INCOME||IV||IV||I-IV||I-IV|
|Net profit/loss for the period||347||239||-415||-644|
|Other comprehensive income, net of tax|
|Change in translation differences||41||36||134||39|
|Fair value changes on available-for-sale investments||57||-66||42||-4|
|Total other comprehensive income||98||-30||176||35|
|Total comprehensive income for the period||445||209||-238||-609|
|Total comprehensive income attributable to:|
|Equity holders of the parent company||377||140||-540||-743|
|STATEMENT OF FINANCIAL POSITION||Dec 31||Dec 31||Dec 31|
|Goodwill||9 501||10 658||8 356|
|Other intangible assets||1 382||1 257||582|
|Property, plant and equipment||2 285||1 952||2 338|
|Non-current financial assets|
|Interest-bearing financial assets||503||569||579|
|Non-interest-bearing financial assets||442||337||340|
|Deferred tax assets||1 011||1 162||904|
|Total non-current assets||15 124||15 939||13 099|
|Inventories||11 740||11 793||10 904|
|Non-interest-bearing receivables||14 708||12 582||10 546|
|Financial assets recognised at fair value through profit and loss||58||275|
|Cash and cash equivalents||4 379||5 337||4 628|
|Total current assets||30 902||29 770||26 353|
|TOTAL ASSETS||46 025||45 708||39 453|
|EQUITY AND LIABILITIES|
|Equity attributable to the equity holders of the parent company:|
|Share capital||2 650||2 650||2 650|
|Share premium fund||7 662||7 662||7 662|
|Invested unrestricted equity fund||223||223||223|
|Retained earnings||5 121||6 351||7 549|
|Minority interest||1 158||1 117||1 137|
|Total equity||16 814||18 003||19 221|
|Interest-bearing liabilities||8 403||8 913||7 180|
|Deferred tax liabilities||136||110|
|Total non-current liabilities||8 539||9 023||7 180|
|Interest-bearing liabilities||2 425||2 305||1 780|
|Non-interest-bearing liabilities||18 247||16 377||11 273|
|Total current liabilities||20 673||18 682||13 052|
|TOTAL EQUITY AND LIABILITIES||46 025||45 708||39 453|
|STATEMENT OF CASH FLOW||IV||IV||I-IV||I-IV|
|Cash flow from operating activities:|
|Cash received from sales||27 248||28 100||91 189||73 880|
| Cash received from other
|Cash paid for operating expenses||-23 990||-26 791||-89 433||-72 348|
|Cash flow from operating activities before financial items and income taxes||3 305||1 428||2 095||1 852|
|Income taxes paid||-118||-100||-372||-125|
|Cash flow from operating activities||3 155||1 239||1 528||1 470|
|Cash flow from investing activities:|
| Investments in intangible and
| Proceeds from sales of intangible and
|Acquisition of subsidiaries, net of cash||-151||-219||-2 293|
|Sale of subsidiaries, net of cash||188||426|
|Repayments of loans receivable||25||29|
|Cash flow from investing activities||-253||-181||-1 512||-2 504|
|Cash flow from financing activities:|
|Acquisition of own shares||-25||-72||-110||-126|
| Cash paid for (received from)
short-term investments (net)
| Withdrawals of long- and short-term
|Repayments of long-term loans||-269||-390||-1 388||-995|
|Cash flow from financing activities||-308||277||-974||1 743|
|Change in cash and cash equivalents||2 594||1 335||-958||709|
|Cash and cash equivalents at the beginning of the period||1 785||4 002||5 337||4 628|
|Cash and cash equivalents at the end of the period||4 379||5 337||4 379||5 337|
STATEMENT OF CHANGES IN EQUITY
|EUR 1000||Equity attributable to equity holders of the parent company|
|Equity on Jan 1, 2009||2 650||7 662||223||7 549||18 084||1 137||19 221|
|Comprehensive income *||-743||-743||134||-609|
|Treasury share acquisition||-126||-126||-126|
|Divestment of subsidiaries||0||-258||-258|
|Changes in ownership||0||196||196|
|Equity on Dec 31, 2009||2 650||7 662||223||6 351||16 886||1 117||18 003|
|Equity on Jan 1, 2010||2 650||7 662||223||6 351||16 886||1 117||18 003|
|Comprehensive income *||-540||-540||302||-238|
|Treasury share acquisition||-110||-110||-110|
|Changes in ownership||-294||-294||-103||-398|
|Equity on Dec 31, 2010||2 650||7 662||223||5 121||15 656||1 158||16 814|
* net of tax
|EUR 1000||Equity attributable to equity holders of the parent company|
|Previously reported equity on Dec 31, 2008||2 650||7 662||223||8 196||18 731||1 137||19 868|
|Change in the consolidation of subsidiary Entre Marketing Oy **||-647||-647||-647|
|Revised equity on Dec 31, 2008||2 650||7 662||223||7 549||18 084||1 137||19 221|
|Previously reported equity on Dec 31, 2009||2 650||7 662||223||6 944||17 479||1 364||18 843|
|Change (2008) in the consolidation of subsidiary Entre Marketing Oy **||-647||-647||-647|
|Change (2009) in the consolidation of Wulff Supplies ***||54||54||-247||-193|
|Revised equity on Dec 31, 2009||2 650||7 662||223||6 351||16 886||1 117||18 003|
** The consolidation of Entre Marketing Oy was revised in the financial statement as of December 31, 2010 by taking into account also the Group’s commitment to reacquire the remaining minority shares. The Group’s ownership share is 84 percentages but it has also a commitment and right to buy back the minority shares, which are currently held by the management of the subsidiary, for a pre-set price and thus the subsidiary should be consolidated as a fully-owned (100 %) group company based on IFRS principles. The goodwill has been impaired annually and because the subsidiary has been loss-making and no positive minority share has been presented in the balance sheet in previous years, this change in the purchase price allocation (EUR 0.65 million) was booked retrospectively in long-term interest-bearing liabilities and decreasing the equity attributable to the parent company shareholders. This change to previous years’ figures has been taken into account also in the key figures presented in this financial statement release.
*** In the financial statement 2009, a 40-percent share of Wulff Supplies’ result 2009 and its equity as of December 31, 2009 was calculated as the minority share and the Group’s commitment to the final acquisition (20 % in 2011) was not taken into account in the minority share. The consolidated goodwill as of December 31, 2009 was based on the agreed 80%-shareholding including the remaining additional acquisition price (20%) and thus the goodwill determined as of December 31, 2009 was not revised retrospectively now. The minority share of the result 2009 was revised by EUR 0.05 million, the minority share in the balance sheet was decreased by EUR 0.25 million and the additional acquisition price (short-term non-interest bearing liabilities) was revised by EUR 0.19 million. These changes to previous year’s figures have been taken into account also in the key figures presented in this financial statement release.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
|Net sales by operating segments|
|Contract Customers Division||22 444||21 736||77 301||57 346|
|Direct Sales Division||4 787||4 261||16 075||17 985|
|Group Services||249||199||1 257||986|
|-407||-472||-1 525||-1 531|
|TOTAL NET SALES||27 073||25 724||93 107||74 785|
|Operating profit/loss by operating segments|
|Contract Customers business||855||470||832||658|
|Contract Customers Division Total||855||290||482||478|
|Direct Sales business||234||283||324||28|
|Direct Sales Division Total||234||283||324||-252|
|Group Services and non-allocated items||-186||-224||-764||-380|
|TOTAL OPERATING PROFIT/LOSS||903||349||43||-154|
|Net sales||27 073||25 724||93 107||74 785|
|Increase/Decrease in net sales, %||5,2 %||27,6 %||24,5 %||-1,8 %|
|EBITDA||1 284||824||1 575||1 247|
|EBITDA margin, %||4,7 %||3,2 %||1,7 %||1,7 %|
|Operating profit/loss margin, %||3,3 %||1,4 %||0,0 %||-0,2 %|
|Profit/Loss before taxes||794||300||223||-360|
|Profit/Loss before taxes margin, %||2,9 %||1,2 %||0,2 %||-0,5 %|
|Net profit/loss for the period attributable to equity holders of the parent company||308||219||-623||-728|
|Net profit/loss for the period, %||1,1 %||0,9 %||-0,7 %||-1,0 %|
|Earnings per share, EUR (diluted = non-diluted)||0,05||0,03||-0,10||-0,11|
|Return on equity (ROE), %||2,07 %||1,33 %||-2,38 %||-3,46 %|
|Return on investment (ROI), %||3,18 %||1,48 %||1,75 %||0,19 %|
|Equity-to-assets ratio at the end of period, %||37,0 %||41,7 %||37,0 %||41,7 %|
|Debt-to-equity ratio at the end of period||34,9 %||29,5 %||34,9 %||29,5 %|
|Equity per share at the end of period, EUR *||2,41||2,58||2,41||2,58|
|Investments in non-current assets||424||426||1 619||915|
|Investments in fixed assets, % of net sales||1,6 %||1,7 %||1,7 %||1,2 %|
|Treasury shares held by the Group at the end of period||99 036||69 022||99 036||69 022|
|Treasury shares, % of total share capital and votes||1,5 %||1,0 %||1,5 %||1,0 %|
|Number of total issued shares at the end of period||6607628||6607628||6607628||6607628|
|Personnel on average during the period||381||378||384||392|
|Personnel at the end of period||370||372||370||372|
* Equity attributable to the equity holders of the parent company / Number of shares excluding the acquired own shares
|QUARTERLY KEY FIGURES||IV||III||II||I||IV||III||II||I|
|Net sales||27 073||20 435||24 016||21 584||25 724||17 570||14 746||16 745|
|Profit/Loss before taxes||794||-327||-200||-43||300||-488||45||-217|
|Net profit/loss for the period||308||-557||-134||-240||219||-581||-55||-311|
|Earnings per share, EUR (diluted = non-diluted)||0,05||-0,09||-0,02||-0,04||0,03||-0,09||-0,01||-0,05|
|RELATED PARTY TRANSACTIONS||IV||IV||I-IV||I-IV|
|Sales to related parties||25||4||93||17|
|Purchases from related parties||14||5||114||8|
|Loan receivables from related parties (management of subsidiaries) at the end of period||566||569||566||569|
|COMMITMENTS||Dec 31||Dec 31|
|Mortgages and guarantees on own behalf|
|Business mortgage for the Group’s loan liabilities||7 350||7 350|
|Real estate pledge for the Group’s loan liabilities||900||900|
| Subsidiary shares pledged as security for
group companies’ liabilities
|3 284||3 634|
| Other listed shares pledged as security for
group companies’ liabilities
| Pledges and guarantees given for the group companies’
off-balance sheet commitments
|Guarantees given on behalf of third parties||236||280|
|Minimum future operating lease payments||6 820||4 397|
Accounting principles applied in the condensed consolidated financial statements
These condensed consolidated financial statements are unaudited. This report has been prepared in accordance with IAS 34 following the valuation and accounting methods guided by IFRS principles. The accounting principles used in the preparation of this report are consistent with those described in the Annual Report 2009 taking into account also the new, revised and amended standards and interpretations. Adoption of the amended standards IFRS 3 (Business Combinations) and IAS 27 (Consolidated and Separate Financial Statements) impacted the accounting of minority shares acquired during the financial period as well as the measurement of minority interests in loss-making subsidiaries. Adopting the amendments in IFRS 2 and IAS 39 as well as the new interpretations IFRIC 17 and IFRIC 18 did not have a material impact on the information presented in this report. The errors in the previous years’ figures discovered along the preparation of 2010 accounts have been revised retrospectively following the IFRS principles and taken into account also in the calculation of key figures, which enables the comparability of the figures presented in this financial statement release.
The IFRS principles require the management to make estimates and assumptions when preparing financial statements. Although these estimates and assumptions are based on the management’s best knowledge of today, the final outcome may differ from the estimated values presented in the financial statements.
In June 2010, the parent company reacquired shares (1 %) in Wulff Supplies from an employee leaving the group. In August, this one-percentage ownership was sold to Wulff Supplies’ new key employee. As these transactions were made based on the share of the equity, they did not impact the Group’s financial result.
Ibero Liikelahjat Oy’s and Wulff Supplies’ additional acquisition prices to be paid in 2011 are re-estimated based on latest forecast, which led to a decrease of EUR 0.82 million in the consolidated goodwill and other short-term liabilities as of December 31, 2010.
The Group acquired the minority shares (8 %) of Torkkelin Paperi Oy from the previous Managing Director Pekka Lähde in December 2010 and now Torkkelin Paperi Oy is fully owned by the Group.
Closing of the small direct sales operations in Lithuania in summer 2010 did not have a material impact on the Group’s net sales, profitability or financial status.
The TyEL pension premium loans withdrawn in summer 2009 have a bank guarantee, the margin of which is linked to the covenants regarding the equity ratio and the interest-bearing debt/EBITDA ratio. The equity ratio shall be 35 % at minimum in the end of each year. On December 31, 2010 the equity ratio was 37.0 % (41.7 %). On December 31, 2010, the interest-bearing debt/EBITDA ratio requirement of 3.5 was not reached. The Group has negotiated with the bank in the autumn and due to this covenant breach, the Group is required to pay a one-off minor compensation to the bank which then will not have other requirements.
The Group has no knowledge of any significant events after the end of the financial period that would have had a material impact on this report in any other way that has been already discussed in the review by the Board of Directors.
In Vantaa on February 8, 2011
WULFF GROUP PLC
BOARD OF DIRECTORS
CEO Heikki Vienola
tel. +358 9 5259 0050 or mobile: +358 50 65 110
NASDAQ OMX Helsinki Oy