ETTEPLAN OYJ INTERIM REPORT Q3: ETTEPLAN’S GROWTH CONTINUED
Stock exchange release – Published: 29.10.2008 9:30:00
Etteplan Q3: ETTEPLAN'S GROWTH CONTINUED
Interim report figures for July-September 2008
- The Group's revenue increased by 31.0% to EUR 36.2 million (7-9/2007: EUR 27.6
million).
- Operating profit increased by 5.1% to EUR 2.2 million (EUR 2.1 million).
- The profit for continuing operations for the period was EUR 1.4 million
(EUR 1.4 million).
- Earnings per share came to EUR 0.07 (EUR 0.05).
- The number of personnel at the end of the period was 2,197 (2,061).
Interim report figures for January-September 2008
- The Group's revenue increased by 35.0% to EUR 121.0 million (1-9/2007:
EUR 89.6 million).
- Operating profit grew by 18.6% to EUR 10.1 million (EUR 8.5 million).
- Profit for continuing operations for the period totaled EUR 6.9 million
(EUR 6.0 million).
- Earnings per share came to EUR 0.34 (EUR 0.28).
- In the explanatory statement of comparative figures for 1-9/2007, capital
gains of EUR 0.84 million for the sale of NATLABS Oy have been eliminated.
- At the beginning of 2008, Etteplan transferred to one segment in financial
reporting.
Key figures (EUR 1 000)
7-9/2008 7-9/2007 1-9/2008 1-9/2007 1-12/2007
Revenue 36 198 27 629 120 959 89 629 125 192
Operating profit 2 175 2 070 10 086 8 503 *) 10 788 *)
Operating profit, % 6,0 7,5 8,3 9,5 *) 8,6 *)
Profit for the period 1 397 1 426 6 891 5 996 *) 7 517 *)
Profit for the period, % 3,9 5,2 5,7 6,7 *) 6,0 *)
Equity ratio, % 35,2 41,3 35,2 41,3 40,7
Net gearing, % 67,7 43,5 67,7 43,5 25,7
Total assets 84 542 72 389 84 542 72 389 72 426
*) In the comparative figures for 2007, capital gains of EUR 0.84 million for
the sale of NATLABS Oy have been eliminated.
Matti Hyytiäinen, President and CEO of Etteplan Oyj, comments on the interim
report as follows:
“Etteplan's business operations continued to grow steadily in the third quarter.
We continued to develop our services in a consistent manner. The Chinese joint
venture started operations in August, and at the end of the period Etteplan had
almost 100 designers in China, providing services for our international
customers. During the period, we acquired a majority holding in Innovation Team
AB, thus strengthening our position as a partner of equipment manufacturers in
the pharmaceutical industry and other sectors utilizing high technology.”
Key customer approach basis for transferring to one segment
Etteplan provides services for various stages in the life cycle of its
customers' products, from product development to product maintenance. For this
reason, Etteplan has reorganized its operations such that services are provided
on a key customer basis and not by design phase. As a result, the company has
stopped reporting for two separate segments and transferred to one segment,
which better depicts the current operations.
Accounting principles
The interim report has been prepared in accordance with IAS 34 (Interim
Financial Reporting) and the preparation and accounting policies presented in
the 2007 annual financial statements, but not all requirements of the IAS 34
standard for interim financial reporting have been followed in the accounting.
REPORT FOR JULY-SEPTEMBER 2008
Business review for July-September
Demand for technical design and technical information services remained high in
July-September 2008. The company continued its profitable growth during the
period. The number of commissions grew further in the heavy vehicle, aerospace,
and defense equipment industries and for design of production lines and process
plants. The number of commissions in the passenger car industry declined. The
average utilization rate for the entire Group remained good throughout the
period.
Financial development for July-September
Revenue in July-September increased by 31.0% from that of the corresponding
period of the previous year and amounted to EUR 36.2 million (EUR 27.6 million).
Operating profit grew by 5.1% to EUR 2.2 million (EUR 2.1 million).
Major events in the third quarter
In July, Etteplan Oyj signed an agreement to acquire a majority stake in the
Swedish Innovation Team AB. This company, established in 1989, specializes in
product development services. The company's customer base consists primarily of
equipment manufacturers in the pharmaceutical industry and other high-technology
companies in the energy and telecommunications industries. The acquisition was
detailed in an investor release on July 2, 2008.
During the period under review, Etteplan signed framework agreements with Scania
AB and Gambro AB in Sweden. The company has concluded an agreement with
Westinghouse AB on design of instrumentation for fuel rods in nuclear power
plants.
REPORT FOR JANUARY-SEPTEMBER 2008
Business review for January-September
Demand for technical design and technical information services was high in
January-September 2008. The capacity utilization rate of the Group was good
throughout the period under review. The most significant sources of growth were
the heavy vehicle, aerospace, and mining industries, as well as production and
industrial facilities.
Revenue
In January-September 2008, Etteplan's revenue increased by 35.0% from that for
the corresponding period of last year, amounting to EUR 121.0 million (EUR 89.6
million). Organic growth accounted for 13.3% of revenue in the review period,
and the remainder was attributable to corporate acquisitions.
Result
Operating profit increased by 18.6% to EUR 10.1 million (EUR 8.5 million), or
8.3% (9.5%) of revenue.
The profit for continuing operations for the period was EUR 9.4 million (EUR 8.3
million). Taxes came to EUR 2.5 million (EUR 2.3 million). Taxes have been
periodized in line with the result for the period. The income tax rate
calculated on profit before taxes in the consolidated income statement was 27.0%
(27.6%).
Profit for continuing operations for the period was EUR 6.9 million (EUR 6.0
million). Earnings per share were EUR 0.34 (EUR 0.28). Equity per share came to
EUR 1.48 (EUR 1.44). The return on investment was 28.0% (28.6%).
Financial position and cash flow
Total assets as of September 30, 2008, had increased by 16.8% to EUR 84.5
million (EUR 72.4 million). Goodwill as shown on the balance sheet was EUR 35.1
million (EUR 29.2 million). The Group's cash and cash equivalents stood at
EUR 3.4 million (EUR 2.9 million). The Group's interest-bearing liabilities
showed an increase because of corporate acquisitions and the need for working
capital on account of business growth, amounting to EUR 23.4 million (EUR 15.8
million) at period end. The equity ratio was 35.2% (41.3%). Cash flow before
investments and financial items totaled EUR 2.6 million (EUR 3.7 million).
Capital expenditure
The Group's gross investments in the period under review came to EUR 11.0
million (EUR 12.8 million). Some of them were financed with company-held shares.
The largest single investments were the acquisition of share capital of Cool
Engineering AB, increase of ownership in Etteplan Technical Information Oy to
100%, and completion of the Lutab Professor Sten Luthander Ingenjörsbyrå AB and
Innovation Team AB acquisitions. Other investments were for business operations
and business development.
Personnel
Etteplan Group's operations and number of personnel have grown steadily. The
number of the Group's personnel averaged 2,180 (1,799) during the review period
and was 2,197 (2,061) at period end. Increases in staff numbers were mostly due
to the business operations transferred to the Group. Outside Finland, the Group
employed 1,097 people (1,031).
Assessment of operating risks and uncertainty factors
Risks related to Etteplan Group's business operations are divided into external
and internal risks, and the risks are monitored according to this
classification.
External risks
External risks include risks concerning economic development on the whole and
unpredictable changes in customers' order backlog, which is classified as the
greatest risk in the company's business operations. Scaling back of operations
in the passenger car industry in Sweden is a risk that has emerged during the
review period.
Internal risks
Internal risks include strategic and operating risks, as well as financing
risks.
Etteplan's most significant strategic risks relate both to development of
business operations and acquisitions. The company aims to manage this risk by
following its acquisitions policy and through procedures and models that have
been prepared on the basis of this policy. In addition to acquisitions, organic
growth is an important part of the growth objectives for Etteplan's business.
Etteplan's greatest operating risks are related to commissions and personnel.
The company's commissions have an inherent risk of services or performances
including a professional error, omissions, or negligence that could cause
significant financial or other damage. In order to contain operating risks, the
company applies the following procedures: application of quality management
systems, codes of practice, and acceptance procedures, coupled with training of
personnel and compliance with instructions on management of quotes and
contracts, particularly in delimitation of contractual liability. The company
has a liability insurance program that encompasses the entire Group. However,
insurance does not cover all liability risk. Also, the company's business is
based on professional personnel, so availability of competent professionals is
an important factor in ensuring profitable growth and continued high-quality
business operations.
Reviews concerning financing risks are presented in the notes to the interim
report.
The company controls the effects of increased financial uncertainty by actively
supervising its receivables and by improving its debt collection processes.
Annual General Meeting
The Etteplan Oyj Annual General Meeting was held in Vantaa on March 28, 2008.
The Board of Directors was confirmed as having five members. Tapio Hakakari,
Heikki Hornborg, Tapani Mönkkönen, Pertti Nupponen, and Matti Virtaala were
reelected as members of the Board. At its organizational meeting of March 28,
2008, the Board elected Heikki Hornborg as chairman and Tapani Mönkkönen as
vice-chairman.
The AGM granted the Board of Directors the authorization to decide upon an issue
of no more than 4,000,000 shares with a share issue or by granting option rights
or other specific rights, referred to in Chapter 10, Article 1 of the Companies
Act, giving entitlement to shares in one or more lots. The authorization
includes the right to decide to issue either new shares or company-held shares.
The authorization is valid for three years from the time of the Annual General
Meeting resolution - i.e., from March 28, 2008, through March 28, 2011.
In addition, the AGM authorized the Board of Directors to decide to acquire the
company's own shares in one or more lots with the company's non-restricted
equity. The acquisition of the company's own shares may be done in a proportion
other than that of the shareholders' share ownership; in other words, the Board
of Directors may also decide on directed acquisition of the company's own
shares. The authorization is valid for 18 months from the Annual General Meeting
resolution, beginning on March 28, 2008, and ending on September 28, 2009.
The resolutions of the Annual General Meeting were detailed in a stock exchange
release dated March 28, 2008.
Dividend
The Annual General Meeting passed a resolution on a motion by the Board of
Directors to pay a dividend for the 2007 financial year of EUR 0.21 per share,
or a total of EUR 4,224,733.80. The remaining profit, totaling EUR 9.2 million,
was retained in non-restricted equity. The dividend was paid on April 9, 2008.
Shares
Shares in Etteplan Oyj (ETT1V) are quoted in the NASDAQ OMX Helsinki Ltd's Small
Cap market capitalization group in the "Industrials" sector.
The company's share capital on September 30, 2008, was EUR 5,000,000.00, and the
number of shares outstanding was 20,179,414. The company has one series of
shares. All shares confer an equal right to dividends and the company's funds.
The company held 292,964 of its own shares on September 30, 2008. In
January−September 2008, the company acquired 391,730 of its own shares. The
company disposed of 296,166 company-held shares in January-September 2008.
With a transaction completed on September 29, 2008, Ingman Finance Oy Ab's
holding of Etteplan Oyj share capital and voting rights rose to exceed the 15%
level. Etteplan published a stock exchange release on the change in ownership on
September 29, 2008.
Major events after the review period
Volvo Car Corporation (VCC) has announced notable reductions in operations in
Sweden. VCC has decided to reduce purchase of external design services by
approximately 80%. Reductions will be implemented from November 2008 onwards.
The effects of the reductions of Etteplan's design assignments are expected to
become clear during the last quarter.
Etteplan has decided to begin reorganizing its passenger car design operations.
The aim of these reorganizations is to secure long term profitability of
business. The reorganization will effect the personnel in Sweden.
Outlook
Demand for Etteplan's services is expected to remain fair in mining industry,
energy and energy transfer sector, aerospace industry and heavy vehicle
industry. Demand for design services in passenger car industry is expected to
decrease considerably. Outlook for forest industry equipment design has become
uncertain.
The revenue for the full year is expected to show growth from the preceding
year. The operating profit for the full year is expected to be approximately
same size as the preceding year. The forecasted operating profit includes an
estimate for the reorganization costs for passenger car design operations.
The information presented herein has not been audited.
Hollola, on October 29, 2008
Etteplan Oyj
Board of Directors
More information available from:
Matti Hyytiäinen, President and CEO, at tel. +358 400 710 968
Pia Björk, CFO and vice-president for Corporate Planning, at tel. +358 400 241
815
APPENDIX:
Financial Statement Summary and Notes
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Cash Flow Statement
Consolidated Statement of Changes in Equity
Key Figures
Notes to the Financial Statement Summary
Releases and other corporate information are available on Etteplan's Web site at
www.etteplan.com.
DISTRIBUTION:
NASDAQ OMX Helsinki Ltd.
Major media
www.etteplan.com
This interim report includes forward-looking estimates and assumptions.
Accordingly, outcomes may deviate from these estimates, which are based on the
management's current best knowledge.
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME STATEMENT | |
--------------------------------------------------------------------------------
| (EUR 1 000) | 7-9/ | 7-9/ | 1-9/ | 1-9/ | 1-12/ |
--------------------------------------------------------------------------------
| | 2008 | 2007 | 2008 | 2007 | 2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Continuing operations |
--------------------------------------------------------------------------------
| Revenue | 36 198 | 27 630 | 120 959 | 89 629 | 125 192 |
--------------------------------------------------------------------------------
| Other operating income | 10 | 33 | 124 | 1 005 | 1 130 |
--------------------------------------------------------------------------------
| Materials and services | -2 903 | -1 867 | -8 557 | -5 766 | -7 941 |
--------------------------------------------------------------------------------
| Staff costs | -24 | -19 329 | -81 905 | -61 688 | -86 486 |
| | 688 | | | | |
--------------------------------------------------------------------------------
| Other operating | -5 981 | -3 907 | -19 152 | -12 425 | -18 351 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Depreciation and | -461 | -491 | -1 384 | -1 413 | -1 917 |
| amortisation | | | | | |
--------------------------------------------------------------------------------
| Operating profit | 2 175 | 2 069 | 10 086 | 9 343 | 11 628 |
--------------------------------------------------------------------------------
| Financial income | 45 | 48 | 103 | 106 | 280 |
--------------------------------------------------------------------------------
| Financial expenses | -276 | -135 | -766 | -322 | -534 |
--------------------------------------------------------------------------------
| Profit before taxes | 1 945 | 1 983 | 9 423 | 9 127 | 11 373 |
--------------------------------------------------------------------------------
| Income taxes | -540 | -557 | -2 524 | -2 291 | -3 016 |
--------------------------------------------------------------------------------
| Profit for the | 1 405 | 1 426 | 6 899 | 6 836 | 8 357 |
| financial year | | | | | |
| Continuing operations | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Discontinuing operations |
--------------------------------------------------------------------------------
| Profit/loss for the | 0 | -140 | -140 | -27 | -146 |
| financial year, | | | | | |
| discontinuing | | | | | |
| operations | | | | | |
--------------------------------------------------------------------------------
| Profit for the | 1 405 | 1 285 | 6 759 | 6 809 | 8 211 |
| financial year | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Attributable to |
--------------------------------------------------------------------------------
| Equity holders of the | 1 397 | 1 215 | 6 751 | 6 487 | 7 848 |
| company | | | | | |
--------------------------------------------------------------------------------
| Minority interest | 8 | 70 | 8 | 322 | 363 |
--------------------------------------------------------------------------------
| | 1 405 | 1 285 | 6 759 | 6 809 | 8 211 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share |
--------------------------------------------------------------------------------
| Continuing operations |
--------------------------------------------------------------------------------
| Basic earnings per | 0,07 | 0,07 | 0,34 | 0,33 | 0,40 |
| share, EUR | | | | | |
--------------------------------------------------------------------------------
| Diluted earnings per | 0,07 | 0,07 | 0,34 | 0,33 | 0,40 |
| share, EUR | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Discontinuing operations |
--------------------------------------------------------------------------------
| Basic earnings per | 0,00 | -0,01 | -0,01 | 0,00 | -0,01 |
| share, EUR | | | | | |
--------------------------------------------------------------------------------
| Diluted earnings per | 0,00 | -0,01 | -0,01 | 0,00 | -0,01 |
| share, EUR | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED BALANCE SHEET |
--------------------------------------------------------------------------------
| (EUR 1 000) | 30.9.2008 | 30.9.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ASSETS |
--------------------------------------------------------------------------------
| Non-current assets | |
--------------------------------------------------------------------------------
| Property, plant and equipment | 2 507 | 2 234 | 1 944 |
--------------------------------------------------------------------------------
| Goodwill | 35 063 | 29 156 | 28 751 |
--------------------------------------------------------------------------------
| Other intangible assets | 2 163 | 2 327 | 2 131 |
--------------------------------------------------------------------------------
| Investments available for sales | 443 | 420 | 420 |
--------------------------------------------------------------------------------
| Other long-term receivables | 787 | 835 | 816 |
--------------------------------------------------------------------------------
| Deferred tax assets | 33 | 210 | 34 |
--------------------------------------------------------------------------------
| Non-current assets, total | 40 996 | 35 180 | 34 096 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current assets |
--------------------------------------------------------------------------------
| Trade and other receivables | 39 343 | 33 948 | 30 890 |
--------------------------------------------------------------------------------
| Current tax assets | 833 | 350 | 198 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 3 370 | 2 910 | 7 243 |
--------------------------------------------------------------------------------
| Current assets, total | 43 546 | 37 209 | 38 330 |
--------------------------------------------------------------------------------
| TOTAL ASSETS | 84 542 | 72 389 | 72 426 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES |
--------------------------------------------------------------------------------
| Capital attributable to equity | |
| holders | |
--------------------------------------------------------------------------------
| Share capital | 5 000 | 5 000 | 5 000 |
--------------------------------------------------------------------------------
| Share premium account | 6 701 | 6 701 | 6 701 |
--------------------------------------------------------------------------------
| Unrestricted equity fund | 2 474 | 2 601 | 2 601 |
--------------------------------------------------------------------------------
| Own shares | -1 265 | 0 | -962 |
--------------------------------------------------------------------------------
| Cumulative translation adjustment | -2 127 | 4 | -823 |
--------------------------------------------------------------------------------
| Retained earnings | 11 962 | 8 339 | 8 339 |
--------------------------------------------------------------------------------
| Net profit for the financial year | 6 751 | 6 487 | 7 848 |
--------------------------------------------------------------------------------
| Capital attributable to equity | 29 497 | 29 132 | 28 704 |
| holders, total | | | |
--------------------------------------------------------------------------------
| Minority interest | 77 | 568 | 597 |
--------------------------------------------------------------------------------
| Equity, total | 29 574 | 29 701 | 29 301 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current liabilities |
--------------------------------------------------------------------------------
| Deferred tax liability | 1 543 | 959 | 1 511 |
--------------------------------------------------------------------------------
| Non-current interest-bearing | 8 684 | 12 680 | 11 606 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Non-current liabilities, total | 10 227 | 13 640 | 13 117 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current liabilities |
--------------------------------------------------------------------------------
| Current interest-bearing | 14 721 | 3 141 | 3 170 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Trade and other payables | 28 314 | 24 137 | 25 415 |
--------------------------------------------------------------------------------
| Current income tax liabilities | 1 704 | 1 771 | 1 422 |
--------------------------------------------------------------------------------
| Current liabilities, total | 44 740 | 29 049 | 30 008 |
--------------------------------------------------------------------------------
| Liabilities, total | 54 968 | 42 688 | 43 125 |
--------------------------------------------------------------------------------
| TOTAL EQUITY AND LIABILITIES | 84 542 | 72 389 | 72 426 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED CASH FLOW STATEMENT |
--------------------------------------------------------------------------------
| (EUR 1 000) | 1-9/ | 1-9/ | 1-12/ |
--------------------------------------------------------------------------------
| | 2008 | 2007 | 2007 |
--------------------------------------------------------------------------------
| Operating cash flow |
--------------------------------------------------------------------------------
| Cash receipts from customers | 116 739 | 86 751 | 121 031 |
--------------------------------------------------------------------------------
| Cash receipts from other operating income | 123 | 165 | 277 |
--------------------------------------------------------------------------------
| Operating expenses paid | 110 752 | 81 607 | 109 430 |
--------------------------------------------------------------------------------
| Operating cash flow before financial items | 6 110 | 5 309 | 11 878 |
| and taxes | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest and payment paid for financial | 710 | 286 | 491 |
| expenses | | | |
--------------------------------------------------------------------------------
| Interest received | 103 | 106 | 280 |
--------------------------------------------------------------------------------
| Income taxes paid | 2 880 | 1 380 | 1 881 |
--------------------------------------------------------------------------------
| Operating cash flow ( A ) | 2 624 | 3 749 | 9 787 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Investing cash flow |
--------------------------------------------------------------------------------
| Purchase of tangible and intangible assets | 1 273 | 810 | 834 |
--------------------------------------------------------------------------------
| Acquisition of subsidiaries | 7 582 | 8 299 | 8 271 |
--------------------------------------------------------------------------------
| Disposal of subsidiaries | 0 | 633 | 578 |
--------------------------------------------------------------------------------
| Proceeds from sale of tangible and | 37 | 46 | 86 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| Proceeds from repayments of loans | 0 | 540 | 540 |
--------------------------------------------------------------------------------
| Proceeds from sale of investments | 31 | 5 | 5 |
--------------------------------------------------------------------------------
| Investing cash flow ( B ) | -8 788 | -7 885 | -7 896 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financing cash flow |
--------------------------------------------------------------------------------
| Purchase of own shares | 1 816 | 0 | 962 |
--------------------------------------------------------------------------------
| Short-term loans, increase | 12 125 | 0 | 0 |
--------------------------------------------------------------------------------
| Long-term loans, increase | 22 | 5 293 | 5 128 |
--------------------------------------------------------------------------------
| Long-term loans, decrease | 3 681 | 1 597 | 2 108 |
--------------------------------------------------------------------------------
| Dividend paid and other profit distribution | 4 225 | 2 776 | 2 776 |
--------------------------------------------------------------------------------
| Financing cash flow ( C ) | 2 425 | 920 | -718 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Variation in cash (A + B + C) | |
--------------------------------------------------------------------------------
| increase ( + ) / decrease ( - ) | -3 740 | -3 216 | 1 173 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Assets in the beginning of the period | 7 243 | 6 174 | 6 174 |
--------------------------------------------------------------------------------
| Exchange gains or losses on cash and bank | 133 | 48 | 104 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Assets at the end of the period | 3 370 | 2 910 | 7 243 |
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(EUR 1 000)
Legends for table columns
A) Share Capital
B) Share Premium Account
C) Unrestricted Equity Fund
D) Own shares
E) Cumulative Translation Adjustment
F) Retained Earnings
G) Minority Interest
H) Total
--------------------------------------------------------------------------------
| | A | B | C | D | E | F | G | H |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity | 2 443 | 9 179 | 0 | 0 | 43 | 10 931 | 872 | 23 468 |
| 1.1.2007 | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | | | | | | -2 592 | -201 | -2 793 |
--------------------------------------------------------------------------------
| Share | 2 557 | -2 | 2 601 | | | | | 2 680 |
| issue | | 478 | | | | | | |
--------------------------------------------------------------------------------
| Purchase | | | | -962 | | | | -962 |
| of own | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Changes | | | | | | | -437 | -437 |
| in | | | | | | | | |
| ownership | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | | | 7 848 | 363 | 8 211 |
| profit | | | | | | | | |
| for the | | | | | | | | |
| financial | | | | | | | | |
| year | | | | | | | | |
--------------------------------------------------------------------------------
| Translati | | | | | -866 | | | -866 |
| on | | | | | | | | |
| adjustmen | | | | | | | | |
| t | | | | | | | | |
--------------------------------------------------------------------------------
| Equity | 5 000 | 6 701 | 2 601 | -962 | -823 | 16 187 | 597 | 29 301 |
| 31.12.200 | | | | | | | | |
| 7 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity | 5 000 | 6 701 | 2 601 | -962 | -823 | 16 187 | 597 | 29 301 |
| 1.1.2008 | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | | | | | | -4 225 | | -4 225 |
--------------------------------------------------------------------------------
| Purchase | | | | -1 | | | | -1 816 |
| of own | | | | 816 | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Disposal | | | -127 | 1 401 | | | | 1 274 |
| of own | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Shares to | | | | 112 | | | | 112 |
| be issued | | | | | | | | |
--------------------------------------------------------------------------------
| Changes | | | | | | | -520 | -520 |
| in | | | | | | | | |
| ownership | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | | | 6 751 | | 6 751 |
| profit | | | | | | | | |
| for the | | | | | | | | |
| financial | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Translati | | | | | -1 | | | -1 304 |
| on | | | | | 304 | | | |
| adjustmen | | | | | | | | |
| t | | | | | | | | |
--------------------------------------------------------------------------------
| Equity | 5 000 | 6 701 | 2 474 | -1 | -2 | 18 713 | 77 | 29 574 |
| 30.9.2008 | | | | 265 | 127 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity | 2 443 | 9 179 | 0 | 0 | 43 | 10 931 | 872 | 23 468 |
| 1.1.2007 | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | | | | | | -2 592 | -201 | -2 793 |
--------------------------------------------------------------------------------
| Share | 2 557 | -2 | 2 601 | | | | | 2 680 |
| issue | | 478 | | | | | | |
--------------------------------------------------------------------------------
| Changes | | | | | | | -424 | -424 |
| in | | | | | | | | |
| ownership | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | | | 6 487 | 321 | 6 808 |
| profit | | | | | | | | |
| for the | | | | | | | | |
| financial | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Translati | | | | | -38 | | | -38 |
| on | | | | | | | | |
| adjustmen | | | | | | | | |
| t | | | | | | | | |
--------------------------------------------------------------------------------
| Equity | 5 000 | 6 701 | 2 601 | 0 | 4 | 14 826 | 568 | 29 701 |
| 30.9.2007 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ETTEPLAN OYJ | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| KEY FIGURES | 1-9/ | 1-9/ | 1-12/ | Change to |
--------------------------------------------------------------------------------
| (EUR 1 000) | 2008 | 2007 | 2007 | prev.year |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Revenue | 120 959 | 89 629 | 125 192 | 35,0 % |
--------------------------------------------------------------------------------
| Operating profit | 10 086 | 9 343 | 11 628 | 8,0 % |
--------------------------------------------------------------------------------
| Operating profit, % | 8,3 | 10,4 | 9,3 | |
--------------------------------------------------------------------------------
| Profit before taxes | 9 423 | 9 127 | 11 374 | 3,2 % |
--------------------------------------------------------------------------------
| Profit before taxes, % | 7,8 | 10,2 | 9,1 | |
--------------------------------------------------------------------------------
| Return on equity, % | 31,2 | 34,1 | 31,7 | |
--------------------------------------------------------------------------------
| Return on investment, % *) | 28,0 | 31,4 | 30,4 | |
--------------------------------------------------------------------------------
| Equity ratio % | 35,2 | 41,3 | 40,7 | |
--------------------------------------------------------------------------------
| Gross interest-bearing debt | 23 406 | 15 821 | 14 777 | 47,9 % |
--------------------------------------------------------------------------------
| Net gearing, % | 67,7 | 43,5 | 25,7 | |
--------------------------------------------------------------------------------
| Balance sheet, total | 84 542 | 72 389 | 72 426 | 16,8 % |
--------------------------------------------------------------------------------
| Gross investments | 10 952 | 12 798 | 13 197 | -14,4 % |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share, EUR | 0,34 | 0,32 | 0,40 | 6,1 % |
--------------------------------------------------------------------------------
| Equity per share, EUR | 1,48 | 1,44 | 1,44 | 2,5 % |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel, average | 2 180 | 1 799 | 1 895 | 21,2 % |
--------------------------------------------------------------------------------
| Personnel at end of the | 2 197 | 2 061 | 1 949 | 6,6 % |
| period | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| *) Return on investment has been calculated from result before taxes |
--------------------------------------------------------------------------------
NOTES TO THE FINANCIAL STATEMENT SUMMARY
General
The parent company of Etteplan Group is Etteplan Oyj (“the Company”), a Finnish
public limited company that was established under Finnish law. The Company is
domiciled in Hollola. The Company's shares are quoted on the exchange of NASDAQ
OMX Helsinki Ltd.
Etteplan Oyj and its subsidiaries provide high-quality industrial technology
design services. The Group's main market area is Europe. In serving core
customers, Etteplan's services extend worldwide.
The Etteplan Oyj Board of Directors approved the interim report for publication
at its meeting of October 28, 2008.
Basis for preparation
The interim report has been prepared in accordance with IAS 34 (Interim
Financial Reporting) and the preparation and accounting policies presented in
the 2007 annual financial statements, but not all requirements of the IAS 34
standard for interim financial reporting have been followed in the accounting.
Monetary figures in the interim report are presented in thousands of euros. All
figures in the tables have been rounded up or down, due to which the sums of
figures may deviate from the sum totals presented.
At the beginning of 2008, the Group started applying the amended instructions of
IFRS 2 (Share-Based Payments). Apart from this, the accounting principles used
were the same as for the 2007 annual financial statements. The annual financial
statements are available at www.etteplan.com/investors/etteplan07.pdf, and the
accounting policy is detailed on pages 24-27 of the annual report.
Income taxes
The taxes listed in the consolidated income statement have been calculated with
the tax rate appropriate for the forecast full-year result. The estimated
average effective tax rate for the year has been set separately for each
country. The effective tax rate used in the interim report is 27.0%.
Acquired business operations
During the period under review, the Group acquired a majority stake in the
Swedish Innovation Team AB. The Group's holding in the company is 91.0%.
Financial risks
Etteplan Oyj's operations involve financial risks, such as foreign-currency,
refinancing and liquidity, interest, and operational credit risks. The Group's
financial risk management concentrates on minimizing the unfavorable impact of
changes in the financial markets on the Group's financial result.
Foreign-currency risk
Etteplan's business operations involve transaction and translation risks
generated by fluctuations in exchange rates. The Group has no major transaction
risks, because business transactions are handled mainly in the currency of the
project country of each Group company, primarily the euro and the Swedish krona.
In the period under review, the company did not take steps to protect itself
against exchange rate changes, since the currency risks were not deemed
significant.
The future will see the increasing number of subcontracting projects between
Group companies and different countries increasing the currency risk involved
in unfavorable exchange rate changes. The Group's translation risk refers to
the impact of fluctuations in exchange rates from translating balance sheet
items of subsidiaries into euros; the Group takes steps to keep translation
risk at a minimum by generating financing for the necessary working capital
in local currencies whenever this is feasible. The levels of the translation
differences in goodwill involved in the Group's foreign company acquisitions
and investments are monitored in conjunction with the impairment tests for
goodwill.
Interest risk
The impact of changes in interest rates on the value of interest-bearing
receivables and liabilities in different currencies generates interest risk.
The Group's cash assets are invested in risk-free interest-bearing investments.
Hedging interest is the means employed to manage the extent of interest risk
related to the fixed and fluctuating interest-bearing loans in the loan
portfolio or to long-term credits.
Refinancing and liquidity risk
The Group has negotiated adequate credit facilities to minimize refinancing and
liquidity risk and to cover the estimated financing needs.
Operational credit risks
A considerable proportion of the business operations focus on large, financially
solid companies that operate internationally. The Group has guidelines to
guarantee that services are sold to only those with an appropriate credit
rating. The financial status of the customers may have an impact on debt
collection and the amount of credit losses. The company controls the effects of
increased financial uncertainty by actively supervising its receivables and by
working to enhance its debt collection processes.
