Salo, Finland, 2011-08-17 07:15 CEST (GLOBE NEWSWIRE) -- Salcomp Plc Interim Report 17 August 2011 at 8:15 a.m. Finnish time
April-June 2011:
-Net sales decreased by 7% to EUR 67.4 million (EUR 72.2 million in April-June 2010).
-Number of chargers delivered decreased by 12% to 60.4 million chargers (68.6 million chargers).
-Market share in mobile phone chargers decreased to some 16% (20%).
-Operating profit weakened by 90% to EUR 0.2 million (EUR 2.3 million).
-Operating profit includes a cost of EUR 0.1 million related to the termination of long-term incentive schemes, due to the ongoing redemption and delisting process.
-Operating profit, excluding the exchange rate gains/losses, was EUR 0.1 million (EUR 1.8 million).
-Earnings per share weakened to EUR -0.02 (EUR 0.04).
-Cash flow from operating activities was EUR 2.2 million negative (EUR 4.7 million positive).
-The holding of Salcomp’s biggest shareholder, Nordstjernan AB, in Salcomp exceeded 90% in March, and Nordstjernan continued with the procedure in order to redeem the rest of the shares and delist the company shares.
January-June 2011:
-Net sales grew by 6% to EUR 139.3 million (EUR 131.8 million in January-June 2010).
-Number of chargers delivered decreased by 3% to 131.2 million chargers (134.5 million chargers).
-Operating profit weakened to EUR -1.2 million (EUR 3.8 million).
-Operating profit includes a cost of EUR 0.6 million related to the termination of long-term incentive schemes, due to the ongoing redemption and delisting process.
-Operating profit, excluding the exchange rate gains/losses, was EUR -1.0 million (EUR 2.8 million).
-Earnings per share weakened to EUR -0.07 (EUR 0.08).
-Cash flow from operating activities was EUR 3.6 million negative (EUR 6.5 million positive).
-Group’s net interest-bearing debt at the end of June was EUR 8.4 million (EUR -1.5 million).
-Cash and cash equivalents at the end of June were EUR 11.2 million (EUR 17.8 million).
Outlook for 2011 unchanged:
-Salcomp's net sales in 2011 are expected to be EUR 280-320 million.
-The operating margin in 2011 is expected to be 2-4% of the net sales.
-Due to the strategy revision of a major customer, Salcomp’s outlook for 2011 continues to be more uncertain than usual.
Markku Hangasjärvi, President and CEO:
”Due to the competitive changes in the smart phone and mobile phone market and the strengthened position of low-end phone manufacturers, especially from China, Salcomp’s number of chargers delivered during the second quarter of the year decreased compared with the previous quarter. This also decreased our net sales in April-June, although higher average sales prices of chargers mitigated the drop.
Despite the decrease in the net sales, our operating profit got back in the black in the second quarter after the negative first quarter. The operating profit was improved by lower material prices compared with the first quarter, as well as a product mix consisting of more expensive products and rise in sales prices.
Our goal is to continue improving the profitability during the second half of 2011. Due to this, we have enhanced our actions in order to broaden our customer and product portfolio, decrease material costs, improve productivity and reduce fixed costs.”
Financial development in April-June 2011
In April-June, Salcomp’s net sales decreased by 7% to EUR 67.4 million (EUR 72.2 million in April-June 2010) due to the decrease in the number of chargers delivered by 12% to 60.4 million (68.6 million) chargers. The number of chargers delivered was decreased by the competitive changes in the smart phone and mobile phone market and the strengthened position of low-end phone manufacturers, especially from China. The impact of a smaller number of sold chargers was mitigated by a rise in average sales prices of chargers, which was mainly due to a product mix consisting of more expensive products, especially smart phone chargers.
According to estimates made by market research companies and the biggest mobile phone manufacturers, some 376 million mobile phones were sold during the second quarter of the year, up by some 11% compared with the April-June period in 2010. In the second quarter of the year, Salcomp’s market share in mobile phone chargers was some 16% compared to some 20% in April-June in 2010. When determining the market volume, the so-called grey market phones, i.e. mobile phones produced without a license, are also included. Salcomp does not deliver chargers to the grey market phones. The decrease in Salcomp’s market share was mainly due to changes in the market shares between mobile phone manufacturers.
Salcomp’s operating profit weakened by 90% to EUR 0.2 million (EUR 2.3 million). This was, on top of a drop in the number of chargers delivered, due to a rise in material and component prices and labor costs, among others, compared with the corresponding period last year. In addition, operating profit was decreased by a cost of EUR 0.1 million related to the termination of long-term incentive schemes, due to the ongoing redemption and delisting process. Operating profit was improved by realized and unrealized exchange rate gains of EUR 0.1 million (EUR 0.6 million of gains). The operating margin in the second quarter of the year was 0.3% (3.2%).
The profit for the period amounted to EUR -0.7 million (EUR 1.5 million). Earnings per share were EUR -0.02 (EUR 0.04), and diluted earnings per share were EUR -0.02 (EUR 0.04).
Cash flow from operating activities in April-June amounted to EUR 2.2 million negative (EUR 4.7 million positive). The cash flow from operating activities decreased mainly due to an increase in net working capital.
Financial development in January-June 2011
The net sales grew by 6% in January-June to EUR 139.3 million (EUR 131.8 million in January-June 2010). The number of chargers delivered decreased by 3% to 131.2 million (134.5 million) chargers.
The operating profit weakened to EUR -1.2 million (EUR 3.8 million) in January-June. This was due to an increase in material and component prices and higher labor costs, compared with the corresponding period last year. In addition, accelerated efforts in broadening the product range and customer base increased fixed costs. Operating profit was weakened by a cost of EUR 0.6 million related to the termination of long-term incentive schemes, due to the ongoing redemption and delisting process. Operating profit was also burdened by realized and unrealized exchange rate losses of EUR 0.3 million (EUR 1.0 million of gains). The operating margin was -0.9% (2.9%) in the first half of the year.
Taxes for the period totaled EUR 0.8 million (EUR 0.5 million). The amount of the Group’s deferred tax has not increased during the period.
The profit for the period was EUR -2.5 million (EUR 3.2 million). Earnings per share were EUR -0.07 (EUR 0.08) and diluted earnings per share EUR -0.07 (EUR 0.08).
R&D and capital expenditure
The Group’s R&D expenditure was EUR 3.4 million (EUR 3.3 million) in January-June, or 2.4% (2.5%) of net sales. R&D focused on developing new products for current and new customers, and constant improvement in the cost structure of existing products.
Capital expenditure in January-June amounted to EUR 3.0 million (EUR 4.0 million). The capital expenditure mainly involved maintaining the production capacity, changes in production lines required by high-end smart phone charger manufacturing and increasing vertical integration by adding capacity in transformer and cable assembly.
Financing
Cash flow from operating activities in January-June was EUR 3.6 million negative (EUR 6.5 million positive), mainly due to an increase in net working capital. Cash and cash equivalents at the end of June were EUR 11.2 million (EUR 17.8 million).
The Group’s equity ratio at the end of June was 43.1% (42.2%), and gearing was 10.8 % (-2.0%). Net interest-bearing debt totaled EUR 8.4 million (EUR -1.5 million) at the end of the period.
Personnel
The number of Group personnel at the end of June totaled 9,047 (9,830): 3,974 were employed in China, 2,119 in Brazil, 2,881 in India, and 73 in Finland and other countries.
Changes in ownership
Salcomp’s biggest shareholder, Nordstjernan AB, informed on 9 March 2011 that it has acquired an additional 4,982,473 shares in Salcomp Plc. After the transaction, Nordstjernan’s total holding in Salcomp amounted to 35,147,189 shares, corresponding to 90.1 per cent of all the shares and votes excluding the 337,000 shares that are in the possession of Salcomp.
After the title to the acquired shares had passed, Nordstjernan informed that it intends to use the right and obligation to redeem the minority shareholders’ shares as stipulated in Chapter 18, Paragraph 1, of the Companies Act. Nordstjernan will further apply for a delisting of the company from the NASDAQ OMX Helsinki exchange in due course.
In accordance with Chapter 2, Section 9 of the Securities Markets Act, Salcomp received a flagging notification from Sampo plc regarding the changes in the holdings in Salcomp on 9 March 2011. The portion held by Mandatum Life Insurance Company Limited, belonging to Sampo Group, of the share capital and votes in Salcomp Plc decreased to below 5% as a result of the sale of shares on 8 March 2011. After the transaction, Mandatum Life Insurance Company does not hold any Salcomp shares.
On 5 April 2011, Nordstjernan informed that the Redemption Committee of the Central Chamber of Commerce has, on the basis of Nordstjernan's application, requested the District Court of Varsinais-Suomi to appoint a trustee for the arbitral proceedings to supervise the interests of the minority shareholders of Salcomp during the redemption proceedings. The District Court of Varsinais-Suomi appointed, on 31 March 2011, attorney-at-law Kim Kyntölä as the trustee.
The Redemption Committee of the Central Chamber of Commerce appointed on the basis of Nordstjernan's application, a three-member arbitral tribunal in the arbitration proceedings regarding the redemption of shares in Salcomp. LL.Lic Antero Molander has been appointed chairman of the arbitral tribunal, and Professor Raimo Immonen and President Ingvar Krook have been appointed members of the arbitral tribunal. The arbitral tribunal shall decide upon e.g. the price of and the redemption right to the shares in Salcomp not owned by Nordstjernan.
On 28 June 2011, Nordstjernan filed its statement of claim with the arbitral tribunal. The redemption price claimed by Nordstjernan is EUR 2.00 per share, which by Nordstjernan is the fair price of the share in accordance with the Finnish Companies Act.
On 5 July 2011, the arbitral tribunal gave the trustee and the minority shareholders the opportunity to submit a reply to Nordstjernan’s statement of claim at the latest on 31 August 2011. The arbitral tribunal’s letter of 5 July 2011 and Nordstjernan’s statement of claim has been mailed to the minority shareholders.
Shares and shareholders
Salcomp's registered share capital amounts to EUR 9,832,735.12, divided into 39,023,840 fully paid outstanding shares and 337,000 shares in the possession of the company. The shares in the possession of the company were acquired through share issues carried out in 2010 related to the share-based incentive programs. The company has one series of shares, and all the shares entitle the shareholder to equal rights in the company.
Salcomp’s share price fluctuated between EUR 1.83 and EUR 2.15 in January-June. The average share price during the period was EUR 1.97, and the closing price at the end of June was EUR 2.00. Share trading amounted to EUR 13.8 million and 6.9 million shares. According to the book-entry system, Salcomp had 676 shareholders at the end of the period. Foreign ownership at the end of June was 94.8%, and the market value for outstanding shares was EUR 78.0 million.
Risks and uncertainties in the near future
Salcomp's business involves uncertainty factors that may affect the company's financial development in the near future. These include the general development of the mobile phone markets, substantial changes in the purchase prices and availability of materials and charger components, significant changes in labor costs, especially in China, as well as changes in the competition in the mobile phone charger markets. Furthermore, changes in the market shares of customers and deterioration in the financial position of major customers may have a negative effect on Salcomp’s business.
Major changes in exchange rates can be considered one of the other short-term uncertainty factors, especially the exchange rate of the US dollar in relation to the euro and to currencies in those countries in which Salcomp has production. In addition, the impact of the global economy on the stability of the financial market, as well as accessibility of financing, has an influence on Salcomp’s business.
In the medium term, Salcomp’s business may be affected by standardization projects concerning mobile phone chargers in the different market areas. Due to standardization, it is possible that, in the future, in some market areas, some mobile phone kits will not include a separate mobile phone charger.
Risks are managed to the extent that the company has influence over them. Further details on risks and risk management are available on the company web site.
Events after the reporting period
There are no events after the reporting date which would have a significant influence on the figures presented in the Interim Report.
Outlook for 2011
According to the estimates published by some of Salcomp's key customers and by various market research companies, the mobile phone market, also including the so-called grey market phones, is expected to grow, measured by the number of units, by some 9% during 2011, compared with 2010. This would mean approximately 1.6 billion mobile phones and, therefore, mobile phone chargers, to be sold in 2011. The volume growth in chargers used in other consumer electronic applications is also estimated to continue in 2011.
Salcomp's net sales in 2011 are expected to be EUR 280-320 million. The operating margin in 2011 is expected to be 2-4% of the net sales. Due to the strategy revision of a major customer, Salcomp’s outlook for 2011 continues to be more uncertain than usual.
Helsinki 17 August 2011
Salcomp Plc
Board of Directors
Further information:
Markku Hangasjärvi, President and CEO, tel. +358 40 7310 114
Jari Saarinen, CFO, tel. +358 40 5004 206
Salcomp Plc’s Interim Report has been prepared in accordance with the international financial accounting standard IAS 34, Interim Reports. This Interim Report is unaudited.
CONDENSED FINANCIAL STATEMENTS AND NOTES
|
STATEMENT OF COMPREHENSIVE INCOME (EUR 1 000) |
||||
| 1-6/2011 | 1-6/2010 | Change % | 1-12/2010 | |
| Net sales | 139 348 | 131 805 | 5.7% | 299 008 |
| Cost of sales | -130 776 | -118 722 | 10.2% | -270 524 |
| Gross margin | 8 572 | 13 083 | -34.5% | 28 484 |
| Other operating income | 14 | 100 | -86.0% | 110 |
|
Sales and marketing expenses |
-1 508 | -1 461 | 3.2% | -3 047 |
| Administrative expenses | -4 943 | -4 593 | 7.6% | -8 875 |
|
Research and development expenses |
-3 377 | -3 315 | 1.9% | -6 884 |
| Other operating expenses | -3 | -7 | -57.1% | -76 |
| Operating result | -1 245 | 3 807 | - | 9 712 |
| Finance income | 76 | 749 | -89.9% | 971 |
| Finance expenses | -606 | -929 | -34.8% | -1 660 |
| Result before tax | -1 775 | 3 627 | - | 9 023 |
| Income tax expenses | -772 | -468 | 65.0% | -1 057 |
| Result for the period | -2 547 | 3 159 | - | 7 966 |
| Other comprehensive income for the period | ||||
| Exchange differences on translating foreign operations | -393 | 3 482 | - | 2 449 |
| Other comprehensive income for the period, net of tax | -393 | 3 482 | - | 2 449 |
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | -2 940 | 6 641 | - | 10 415 |
| Basic earnings per share, EUR | -0.07 | 0.08 | - | 0.20 |
| Diluted earnings per share, EUR | -0.07 | 0.08 | - | 0.20 |
|
STATEMENT OF COMPREHENSIVE INCOME (EUR 1 000) |
|||
| 4-6/2011 | 4-6/2010 | Change % | |
| Net sales | 67 411 | 72 170 | -6.6% |
| Cost of sales | -62 319 | -64 962 | -4.1% |
| Gross margin | 5 092 | 7 208 | -29.4% |
| Other operating income | 11 | 100 | -89.0% |
|
Sales and marketing expenses |
-803 | -872 | -7.9% |
| Administrative expenses | -2 265 | -2 301 | -1.6% |
|
Research and development expenses |
-1 800 | -1 803 | -0.2% |
| Other operating expenses | 0 | -5 | - |
| Operating profit | 235 | 2 327 | -89.9% |
| Finance income | 63 | 87 | -27.6% |
| Finance expenses | -320 | -484 | -33.9% |
| Profit before tax | -22 | 1 930 | - |
| Income tax expenses | -632 | -402 | 57.2% |
| Profit for the period | -654 | 1 528 | - |
| Other comprehensive income for the period | |||
| Exchange differences on translating foreign operations | 12 | 2 418 | -99.5% |
| Other comprehensive income for the period, net of tax | 12 | 2 418 | -99.5% |
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | -642 | 3 946 | - |
| Basic earnings per share, EUR | -0.02 | 0.04 | - |
| Diluted earnings per share, EUR | -0.02 | 0.04 | - |
|
STATEMENT OF FINANCIAL POSITION (EUR 1 000) |
||||
| 30.6.2011 | 30.6.2010 | Change % | 31.12.2010 | |
| Non-current assets | ||||
| Property, plant and equipment | 23 899 | 24 446 | -2.2% | 25 281 |
| Goodwill | 66 412 | 66 412 | 0.0% | 66 412 |
| Other intangible assets | 904 | 635 | 42.4% | 830 |
| Deferred tax assets | 4 054 | 3 257 | 24.5% | 4 023 |
| 95 269 | 94 750 | 0.5% | 96 546 | |
| Current assets | ||||
| Inventories | 31 841 | 26 550 | 19.9% | 37 246 |
| Trade and other receivables | 43 092 | 43 357 | -0.6% | 46 233 |
| Cash and cash equivalents | 11 208 | 17 815 | -37.1% | 18 553 |
| 86 141 | 87 722 | -1.8% | 102 032 | |
| Total assets | 181 410 | 182 472 | -0.6% | 198 578 |
| Equity and liabilities | ||||
| Share capital | 9 833 | 9 833 | 0.0% | 9 833 |
| Invested unrestricted equity | 5 820 | 19 401 | -70.0% | 5 820 |
| Retained earnings | 62 583 | 47 603 | 31.5% | 64 881 |
| 78 236 | 76 837 | 1.8% | 80 534 | |
| Non-current liabilities | ||||
| Deferred tax liabilities | 17 300 | 17 303 | 0.0% | 17 317 |
| Interest-bearing liabilities | 17 197 | 13 853 | 24.1% | 11 187 |
| 34 497 | 31 156 | 10.7% | 28 504 | |
| Current liabilities | ||||
| Trade and other payables | 66 252 | 72 054 | -8.1% | 81 321 |
| Interest-bearing current liabilities | 2 425 | 2 425 | 0.0% | 8 219 |
| 68 677 | 74 479 | -7.8% | 89 540 | |
| Total equity and liabilities | 181 410 | 182 472 | -0.6% | 198 578 |
|
STATEMENT OF CHANGES IN EQUITY (EUR 1 000) |
||||||
| Attributable to equity holders of the parent | ||||||
| Share capital | Invested unrestricted equity | Translation differences | Retained earnings | Total equity | ||
| Equity on 1 Jan 2010 | 9 833 | 22 035 | 2 285 | 38 456 | 72 609 | |
| Total comprehensive income for the period | 0 | 0 | 3 482 | 3 159 | 6 641 | |
| Share issue | 0 | 96 | 0 | 0 | 96 | |
| Repayment of capital* | 0 | -2 730 | 0 | 0 | -2 730 | |
| Incentive plans | 0 | 0 | 0 | 221 | 221 | |
| Equity on 30 June 2010 | 9 833 | 19 401 | 5 767 | 41 836 | 76 837 | |
| Equity on 1 Jan 2011 | 9 833 | 5 820 | 4 734 | 60 147 | 80 534 | |
| Total comprehensive income for the period | 0 | 0 | -393 | -2 547 | -2 940 | |
| Incentive plans** | 0 | 0 | 0 | 642 | 642 | |
| Equity on 30 June 2011 | 9 833 | 5 820 | 4 341 | 58 242 | 78 236 | |
*AGM decision on 24 March, repayment of capital done on 7 April
**Delisting cost effect included
|
STATEMENT OF CASH FLOWS (EUR 1 000) |
||||
| 1-6/2011 | 1-6/2010 | Change % | 1-12/2010 | |
| Cash flow before change in working capital | 2 109 | 6 496 | -67.5% | 15 113 |
| Change in working capital | -4 513 | 1 980 | - | -2 878 |
| Financial items and taxes | -1 215 | -1 929 | -37.0% | -2 562 |
| Net cash flow from operating activities | -3 619 | 6 547 | - | 9 673 |
| Purchases | -3 048 | -3 968 | -23.2% | -8 950 |
| Sales | 0 | 81 | - | 19 |
| Cash flows from investing activities | -3 048 | -3 887 | -21.6% | -8 931 |
| Cash flow before financing | -6 667 | 2 660 | - | 742 |
| Withdrawal of borrowings | 4 000 | 16 466 | -75.7% | 20 794 |
| Repayment of borrowings | -3 834 | -19 333 | -80.2% | -20 583 |
| Share issue | 0 | 96 | - | 96 |
| Dividends* | 0 | -2 730 | - | -2 730 |
| Net cash flow from financing activities | 166 | -5 501 | - | -2 423 |
| Change in cash and cash equivalents | -6 501 | -2 841 | 128.8% | -1 681 |
|
Cash and cash equivalents at the beginning of the period |
18 553 | 18 872 | -1.7% | 18 872 |
| Translation difference | -844 | 1 784 | - | 1 362 |
|
Cash and cash equivalents at the end of the period |
11 208 | 17 815 | -37.1% | 18 553 |
*repayment of capital
| KEY FIGURES | ||||
| 1-6/2011 | 1-6/2010 | Change % | 1-12/2010 | |
| Sold chargers, Mpcs | 131.2 | 134.5 | -2.5% | 296.6 |
| Average sales price, EUR | 1.06 | 0.98 | 8.4% | 1.01 |
| Net sales, MEUR | 139.3 | 131.8 | 5.7% | 299.0 |
| EBITDA, MEUR | 1.5 | 6.4 | -76.6% | 15.0 |
| EBITDA%, % | 1.1% | 4.9% | 5.0% | |
| Operating result, MEUR | -1.2 | 3.8 | - | 9.7 |
| Operating margin, % | -0.9% | 2.9% | 3.2% | |
| Basic earnings per share, EUR | -0.07 | 0.08 | - | 0.20 |
| Diluted earnings per share, EUR | -0.07 | 0.08 | - | 0.20 |
| Earnings per share excluding deferred tax, EUR | -0.07 | 0.08 | - | 0.20 |
| Equity per share, EUR | 2.00 | 1.97 | 1.5% | 2.06 |
| Return on equity, % | 2.8% | 10.4% | 10.4% | |
| Return on capital employed, % | 5.0% | 13.2% | 11.1% | |
| Return on net assets, % | 15.1% | 51.6% | 39.8% | |
| Equity ratio, % | 43.1% | 42.2% | 40.6% | |
| Gearing, % | 10.8% | -2.0% | 1.1% | |
| Capital expenditure, MEUR | 3.0 | 4.0 | -23.2% | 9.0 |
| Capital expenditure, % of net sales | 2.2% | 3.0% | 3.0% | |
| Personnel on average | 9 081 | 8 841 | 2.7% | 9 825 |
| Personnel at the end of period | 9 047 | 9 830 | -8.0% | 10 350 |
| Average number of shares outstanding | 39 023 840 | 38 977 082 | 39 000 461 | |
| Number of shares outstanding at the end of period | 39 023 840 | 39 023 840 | 39 023 840 | |
| Diluted number of shares outstanding on average | 39 024 845 | 38 806 885 | 39 001 219 | |
| Highest share price, EUR | 2.15 | 2.19 | 2.19 | |
| Lowest share price, EUR | 1.83 | 1.85 | 1.73 | |
| Average share price, EUR | 1.97 | 2.00 | 1.99 | |
| Traded shares, Mpcs | 6.9 | 1.4 | 2.1 | |
| Traded shares, MEUR | 13.8 | 2.9 | 4.2 |
NOTES TO THE INTERIM REPORT
This Interim Report has been prepared in accordance with the international financial accounting standard IAS 34 Interim Reports. The same accounting principles are applied in this Interim Report as in the Financial Statements. Compared with the Financial Statements, amended standards or interpretations have not affected this Interim Report. Salcomp has one business segment, chargers. Internal management reporting complies with the IFRS reporting and due to this, separate adjustments are not presented.
|
LIABILITIES (EUR 1 000) |
|||||
| 30.6.2011 | 30.6.2010 | Change % | 31.12.2010 | ||
| For own dept | |||||
| Company and real estate mortgages | 82 000 | 82 000 | 0.0% | 82 000 | |
| Others | 5 872 | 5 | 117 340.0% | 5 872 | |
| Leasing and rental liabilities | 5 402 | 7 130 | -24.2% | 5 382 | |
| 93 274 | 89 135 | 4.6% | 93 254 | ||
| QUARTERLY INFORMATION | ||||||
| 4-6/11 | 1-3/11 | 10-12/10 | 7-9/10 | 4-6/10 | 7/10-6/11 | |
|
Sold chargers, kpcs |
60 416 | 70 771 | 81 933 | 80 098 | 68 586 | 293 218 |
| Net sales, kEUR | 67 411 | 71 937 | 80 733 | 86 470 | 72 170 | 306 551 |
| Operating result, kEUR | 235 | -1 480 | 2 540 | 3 365 | 2 327 | 4 660 |
| Operating margin, % | 0.3% | -2.1% | 3.1% | 3.9% | 3.2% | 1.5% |
| Average sales price, EUR | 1.12 | 1.02 | 0.99 | 1.08 | 1.05 | 1.05 |
OPTION RIGHTS
During the financial year 2007, the General Meeting of Shareholders established an option program with a total of 2,047,500 option rights that entitle to subscribe the same amount of new shares of the company. The option program is divided to symbols 2007A, 2007B and 2007C. The Board of Directors has not granted option rights to Group key personnel during the financial year. The share based incentives are conditional. The vesting conditions are based on that the total shareholder return is at least 8% per annum. Options are lost when a person is leaving the company before the settlement period begins. The Board of Directors can decide in these cases that the stock option owner is entitled to keep the options or a part of them. The fair value has been determined using the Cox-Ross-Rubinstein binomial model.
| Program symbol | 2007A | 2007B | 2007C | Total options |
| Number of options | 657 500 | 682 500 | 707 500 | 2 047 500 |
| Vesting period |
1.4.2007- 31.3.2010 |
1.4.2008- 31.3.2011 |
1.4.2009- 31.3.2012 |
|
| Options granted before the current financial year | 465 000 | 507 500 | 627 500 | 1 600 000 |
| Options granted during the current financial year | 0 | 0 | 0 | 0 |
| Options forfeited during the current financial year | 0 | 0 | 0 | 0 |
| Settlement (shares / option) | 1 | 1 | 1 | |
| Settlement period |
1.4.2010- 31.3.2012 |
1.4.2011- 31.3.2013 |
1.4.2012- 31.3.2014 |
|
| Grant date | 02.05.07 | 07.05.08 | 11.08.09 | |
| Exercise price | 2.81 | 3.33 | 1.40 | |
| Share price at grant date | 3.51 | 3.79 | 1.51 | |
| The fair value of option at grant date | 1.44 | 1.44 | 0.61 |
SHARE BASED INCENTIVE PROGRAM
Salcomp Plc has two share-based incentive programs for the Group key personnel. The programs are a Matching Share Program targeted at the members of the Extended Global Management Team, as well as a Performance Share Program targeted at 53 key employees including also the members of the Extended Global Management Team. Both Programs include one earning period, from calendar year 2010 to 2012. The potential rewards from both the Matching and Performance Share programs will be paid partly in Company shares and partly in cash during 2013. The cash payment is intended to cover the personal taxes and tax-related costs arising from the reward. No reward will be paid to a key person, if his or her employment or service in a Group Company ends before the reward payment. The rewards to be paid on the basis of the earning period will correspond to the value of maximum 532,000 Salcomp Plc shares. Global Management Team can earn a total of 281,000 pcs of Salcomp Plc shares during the total earning period. Releases relating to the new incentive program have been issued in May 19 and June 21, 2010. Cost effect of delisting, started during spring 2011 due to the changes in ownership, is presented in statement of changes in equity.
|
RELATED PARTY INFORMATION (EUR 1 000) |
||||
| Related party transactions with Nordstjernan AB | 30.6.2011 | 30.6.2010 | Change % | 31.12.2010 |
| Capital loans | 0 | 0 | - | 0 |
| Interest payable of capital loans | 0 | 0 | - | 0 |
| Sales of receivables | 0 | 0 | - | 0 |
| Interest expense of the period | 0 | 553 | -100.0% | 553 |
| Salcomp has renewed the financing arrangements in May 2010. In this connection, the capital loans have been repaid to Nordstjernan AB. Release on the issue has been published in May 25, 2010. | ||||
| OWN SHARES | ||
| 30.6.2011 | 30.6.2010 | |
| Parent company own shares (pcs) | 337 000 | 337 000 |
CALCULATION OF FINANCIAL RATIOS
Average personnel: Average number of personnel at end of each month
Return on equity (%) = Result for the period x 100 : Equity on average
Return on capital employed (%) = (Result before tax + interest charges and other financial expenses) x 100 : (Total liabilities less interest-free debt (on average))
Return on net assets (%) = Operating result x 100 : (Fixed assets less goodwill and deferred tax assets + inventory + short-term receivables less short-term interest-free debt on average)
Equity ratio (%) = Equity x 100 : Total liabilities less received advance payments
Gearing (%) = (Interest-bearing debt less cash and cash equivalents) x 100 : Equity
Earnings per share = Result for the period : Weighted average number of shares outstanding during the period
Equity per share = Equity : number of shares outstanding at the end of period
Earnings per share, diluted = Result for the period : Weighted average number of shares outstanding during the period, adjusted for the share issue
Markku Hangasjärvi, President and CEO, tel. +358 40 7310 114
Jari Saarinen, CFO, tel. +358 40 5004 206
