16.02.2000
Aspocomp Group Financial Performance 1999
Operating profit after depreciation totalled EUR 21.5 million (EUR 11.8 million) and after financial items EUR 20.1 million (EUR 10.2 million). Pre-tax profit amounted to EUR 19.4 million (EUR 10.2 million). Group net sales totalled EUR 201.3 million (EUR 126.7 million). Earnings per share totalled EUR 1.64 (EUR 0.83). The dividend proposal will be EUR 0.50 per share. Aspocomp Group Oyj Board is considering alternatives to develop the capital structure of the company.
BUSINESS CONDITIONS
In 1999, Aspocomp Group net sales totalled EUR 201.3 million (EUR 126.7 million) and earnings after financial items EUR 20.1 million (EUR 10.2 million).
Aspocomp Group Oyj was registered in the Trade Register on October 1, 1999 as a consequence of the division of the Aspo Group into two separately listed companies, Aspo Plc and Aspocomp Group Oyj, both listed on the Helsinki Stock Exchange.
The last three months of 1999 comprise the first official fiscal year of the Aspocomp Group. This information is presented separately.
In this report, financial information is presented on a pro forma basis. The accounting principles have been changed to correspond better the international accounting standards. As a result, also the figures for the previous years have been modified. The calculation principles for the pro forma figures are presented in more detail in the prospectus issued on April 8, 1999 and updated on September 28, 1999.
NET SALES
The Group’s net sales increased by EUR 74.6 million to EUR 201.3 million for the year. The acquisition of the French PCB plant increased net sales by EUR 57.7 million. Excluding the acquisition, the increase would have been EUR 21.9 million. The share of the company’s three biggest customers, Ericsson, Nokia and Philips, in net sales was 59 %. Direct export from Finland totalled EUR 19.7 million (EUR 18.5 million) and offshore net sales totalled EUR 57.7 million (EUR 5.0 million).
The share of the Printed Circuit Board Sector of Aspocomp’s total net sales was EUR 160.2 million (EUR 88.0 million) and the share of Electronics Manufacturing Services Sector was EUR 41.1 million (EUR 38.6 million). The PCB Business was re-organized into Mobile, Telecom and Auto & Industry Business Units during the spring 1999.
The Mobile Business Unit supplies high technology Printed Circuit Boards (PCBs) and related services to mobile phone customers. This Business Unit’s net sales comprised 38 % of Aspocomp’s total.
The Telecom Business Unit provides PCB-related services for telecom infrastructure customers producing e.g. base stations for mobile phone networks. Its net sales comprised 25 % of the Group total.
The Auto & Industry Business Unit provides PCB-related services for automotive and industrial customers. Auto & Industry net sales represented 17 % of total.
The EMS Business Unit provides focused services in thick film hybrid circuits and mechanical assemblies mainly to the same customers as the PCB units. Its net sales represented 20 % of the Group total.
EARNINGS
Operating profit for the year 1999 totalled EUR 21.5 million or 10.7 % of net sales (EUR 11.8 million; 9.3 %). The Printed Circuit Board Sector’s operating profit was EUR 17.0 million (EUR 8.0 million) or 10.6 % of its net sales (9.5 %). The operating profit of the Mobile Business Unit was good, the Telecom Business Unit’s satisfactory and the Auto & Industry Business Unit’s not satisfactory. Aspocomp SAS in France produces printed circuit boards for all the PCB Business Units. Its operating profit was negative. However, due to re-organization of the production and new technologies its performance has improved towards the end of the year. The operating profit of the Sector EMS was good; EUR 4.5 million (EUR 3.9 million) or 11.0 % of its net sales (10.1 %).
Net financial costs totalled EUR 1.3 million (EUR 1.6 million). During the fiscal year, prior to the division, the company negotiated new short-term credit limits for securing the smooth transition to the post-split conditions.
Profit before extraordinary items and taxes was EUR 20.1 million (EUR 10.2 million). The only item under extraordinary costs was a pension liability deriving from the Aspo Group pension fund which will be dissolved. The profit before taxes was EUR 19.4 million (EUR 10.2 million) and the net profit for the period was EUR 13.7 million (EUR 7.3 million).
Earnings per share totalled EUR 1.64, diluted including the option rights EUR 1.62 (EUR 0.83). Equity per share totalled EUR 7.87 (EUR 6.30).
During the period 4 October, 1999 to 31 December, 1999, the Aspocomp share price appreciated 47.7 %, compared with 45.0 % for the HEX Portfolio Index for the same period. During the period 4 October, 1999 to 14 February, 2000, the Aspocomp share price appreciated 103.5 %, compared with 47.8 % for the HEX Portfolio Index for the same time period.
FINANCING, INVESTMENTS AND EQUITY RATIO
The Group’s liquidity was satisfactory in spite of certain major investments. Gross investments for the year totalled EUR 41.1 million (EUR 27.8 million) or 20.4 % of net sales (21.9 %). EUR 6.5 million of the investments related to expansion projects for example at the Salo, Padasjoki, Oulu and Evreux plants. The major part of the remainder, EUR 34.6 million, was invested in production equipment. Most important investment project comprised new technology with laser drilling machines and product testing representing a total investment of EUR 15.4 million. The purpose of the investments is to increase capacity as well as the capability and efficiency.
Net financial costs as a percentage of net sales totalled 0.7 % (1.3 %).
The equity ratio was 43.9 % at the period end (43.5%).
PRO FORMA CALCULATIONS
Aspocomp SAS was integrated into the Group at the point of acquisition, from the end of November 1998. The parent company balance sheet has been prepared in accordance with the principles laid out in the division plan. Adjustments to expenses incurred have been estimated and are not as such based upon costs realized.
THE SHARES AND SHARE CAPITAL
As of December 31, 1999, Aspocomp Group Oyj’s total share capital amounted to EUR 8,770,416 with a total 8,770,416 shares outstanding.
During the period extending from October 1 to December 30, a total of 805,345 shares with a value of EUR 19,110,419 were traded on the Helsinki Stock Exchange. The non-Finnish share in the ownership of the stock was 9.48 % as of the end of the period. The company’s share price reached a high of EUR 37.66 and a low of EUR 21.50 between October 1 and December 30, 1999 and the average share price was EUR 23.73. The closing price for December 30, 1999 was EUR 37.00.
The company’s extraordinary Shareholders’ Meeting on October 22, 1999 decided to grant stock options to key company persons (to be separately nominated) employed by the Aspocomp Group or the Group’s subsidiary. Up to total of 750,000 options, which represent a total of 750,000 Aspocomp Group Oyj shares, would be issued after subscription correspondent to 7.88 % of the total shares outstanding. The share capital can be increased by up to EUR 750,000. The subscription price will be EUR 25.00 per share. The subscribed shares are entitled to dividend for the period during which they have been subscribed. Other shareholder rights begin on the date of the registration in the Trade Register. The subscription period will start on November 1, 2001 for A options and on November 1, 2003 for B options. The subscription period for all the stock options will expire on November 30, 2005. Stock option rights were registered on December 29, 1999.
PERSONNEL
The Group’s personnel totalled 1,858 (1,678) at the year-end 1999 and averaged 1,886 (1,216) from January 1 to December 31, 1999. The Group employed an average of 287 office workers and an average of 1,599 other employees during the period under review.
PROPOSAL FOR THE DISTRIBUTION OF DIVIDEND
The Board of Directors will propose at the Annual Shareholders’ Meeting to be held on March 17, 2000, that a dividend of EUR 0.50 per share be distributed to the shareholders. The dividend record date will be March 22, 2000 and the dividends will be paid on March 29, 2000 according to the proposal of the Board.
PROSPECTS FOR 2000
The Aspocomp Group´s operations are expected to develop favorably during the year 2000. The development is expected to be particularly strong during the third and the fourth quarters of the year, the latter being traditionally the strongest quarter in the industry. Another reason for the expected favorable development during the second half of the year is the new plant expansions, which are expected to be ready for production in the autumn.
This view is based upon the Group’s current situation.
ASPOCOMP GROUP PRO FORMA INCOME STATEMENT
| 1999 | 1998 | Change | Change | |
| MEUR | MEUR | MEUR | % | |
| NET SALES | 201.3 | 126.7 | 74.6 | 58.9 |
| Other operating income | 2.5 | 0.6 | 1.9 | |
| Depreciation and write-downs | 19.8 | 12.9 | 6.9 | 53.5 |
| OPERATING PROFIT AFTER DEPRECIATION | 21.5 | 11.8 | 9.7 | 82.2 |
| Financial income and expenses | -1.3 | -1.6 | -0.3 | -18.8 |
| PROFIT BEFORE EXTRAORDINARY ITEMS AND TAXES | 20.1 | 10.2 | 9.9 | 97.1 |
| Extraordinary income | 0.0 | 0.0 | 0.0 | |
| Extraordinary expences | -0.7 | 0.0 | -0.7 | |
| PROFIT BEFORE TAXES | 19.4 | 10.2 | 9.2 | 90.2 |
| PROFIT FOR THE PERIOD | 13.7 | 7.3 | 6.4 | 87.7 |
| EARNINGS/SHARE, EUR | 1.64 | 0.83 | 0.81 | 97.6 |
Figures are unaudited.
ASPOCOMP GROUP PRO FORMA BALANCE SHEET
| 1999 | 1998 | Change | Change | |
| MEUR | MEUR | MEUR | % | |
| Non-Current Assets | ||||
| Intangible Assets | 3.2 | 2.7 | 0.4 | 18.5 |
| Tangible Assets | 93.4 | 73.8 | 19.6 | 26.5 |
| Investments | 0.1 | 0.1 | 0.0 | 0.0 |
| Current Assets | ||||
| Inventories | 23.4 | 16.8 | 6.6 | 39.3 |
| Receivables | 35.0 | 30.8 | 4.2 | 13.6 |
| Cash and bank deposits | 2.3 | 2.8 | -0.5 | -17.8 |
| TOTAL ASSETS | 157.4 | 127.0 | 30.3 | 23.9 |
| Shareholders’ equity | ||||
| Share capital | 8.8 | 8.8 | 0.0 | 0.0 |
| Other shareholders’ equity | 60.2 | 46.5 | 13.7 | 29.5 |
| Mandatory reserves | 0.3 | 0.3 | 0.0 | 0.0 |
| Long-term liabilities | 37.9 | 30.2 | 7.7 | 25.5 |
| Short-term liabilities | 50.2 | 41.2 | 9.0 | 21.8 |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 157.4 | 127.0 | 30.3 | 23.9 |
| KEY FIGURES | ||||
| Equity / share, EUR | 7.87 | 6.30 | ||
| Equity Ratio, % | 43.9 | 43.5 | ||
| Gearing | 56.4 | 56.6 | ||
| Return on Equity, % | 23.2 | 14.0 | ||
| Return on Investment, % | 21.6 | 14.8 | ||
| (ROI) | ||||
| Gross Investments, MEUR | 41.1 | 27.8 | ||
| Average Personnel | 1,886 | 1,216 |
Figures are unaudited.
Accumulated excess depreciation and voluntary reserves totalling EUR 13.9 million have been divided among shareholders’ equity and nominal tax liabilities.
| CONTINGENT LIABILITIES | 1999 | 1998 |
| MEUR | MEUR | |
| Securities on Group liabilities | 3.9 | 2.0 |
| Operational Leasing liabilities | 0.5 | 0.7 |
| Fixed assets financed by financial leasing are recorded in the balance sheet. | ||
| TOTAL | 4.4 | 2.7 |
There are no derivative contracts.
SHARE CAPITAL STRUCTURE
The Board of Directors of Aspocomp Group Oyj has decided to investigate the possibilities to finance future growth by developing the capital structure of the company. The Board has decided to retain the investment bank Merrill Lynch International as its advisors and the company Conventum Plc to be their Finnish partner.
ANNUAL SHAREHOLDERS’ MEETING
The Aspocomp Group Oyj Annual Shareholders’ Meeting will be held on Friday, March 17, 2000 at 2:00 PM at the hotel Palace in Helsinki, Eteläranta 10. The record date for the Annual Shareholders’ Meeting will be March 10, 2000.
ANNUAL REPORT 1999
The Aspocomp Group Annual Report 1999 will be published on March 10, 2000.
FINANCIAL INFORMATION IN 2000
The Aspocomp Group will release its quarterly reports during the year 2000 on April 28, 2000, July 28, 2000 and October 27, 2000.
Helsinki February 16, 2000
ASPOCOMP GROUP Oyj
Board of Directors
For more information contact President and CEO Jarmo Niemi at int. +358 9 759 70711
ASPOCOMP GROUP Oyj
Jarmo Niemi
President and Chief Executive Officer
Distribution:
Helsinki Exchanges
Press and Media
www.aspocomp.com