Harju Elekter Group financial results, 1-12/2018

Seotud dokumendid: 

The sales revenue of AS Harju Elekter for the fourth quarter of 2018 was 31.7 million euros, growing by 10.9% in comparison with the reference period. The consolidated sales revenue for the financial year increased by 18% to 120.8 million euros over the year. In Q4 2018, the Group's consolidated net profit was 736 thousand euros and for 12 months 1,514 thousand euros. In coordination with the Supervisory Board, the Group's Management Board proposes to distribute 0.18 euros per share to shareholders in the form of dividends, totalling 3.2 million euros, which is almost twice the net profit for the financial year.

In recent years, AS Harju Elekter has made large-scale investments and active sales work to increase its market share in Scandinavia. From the beginning of 2018, two Swedish companies were merged with the Group. As a result, the Group's sales have doubled in the last two years but integrating new subsidiaries into the Group is a long-term process and reaching the desired profitability requires extra time and expenses. The profitability of the financial year was significantly affected by the potential loss of 1.9 million euros related to the shipbuilding electrical work taken into account in the second half of the financial year. The actual amount of the loss will be determined at the end of the negotiations and legal disputes.

 

Change

January - December

Change

October-December

(thousand euros)

%

2018

2017

%

2018

2017

Sales revenue

18.0

120,804

102,402

10.9

31,669

28,552

Gross profit

4.0

15,976

15,359

13.1

4,867

4,304

EBITDA

-34.1

5,001

7,587

-27.5

1,701

2,345

EBIT

-55.7

2,413

5,442

-28.3

1,007

1,404

Profit for the period

-94.8

1,514

29,132

-22.2

736

946

incl attributed to Owners of the Company

-94.7

1,546

29,129

-24.7

735

976

Net profit for the period without extraordinary income

-64.7

1,514

4,293

-22,2

736

946

 

 

 

 

 

 

 

 

 

 

 

During the reporting quarter 84.2% (Q4 2017: 75.9%) of the Group’s sales revenue was earned from the Manufacturing segment, Real Estate and Unallocated activities contributed 15.8% (Q4 2017: 24.1%) of the consolidated sales revenue. The sales revenue of the Real Estate segment increased by 0.3 million euros to 0.8 million euros in the reporting quarter, and by 0.6 million euros to 2.6 million euros in the comparison of years, mainly due to the increase in rental income as the result of the completion and lease of new production and warehouse facilities in Allika Industrial Park. In total, 82.6% (2017: 83.2%) of the Group's yearly sales revenue was generated from the Manufacturing segment.

The Group’s sales revenue earned outside Estonia accounted for 84.9% in Q4 (Q4 2017: 85.7%), increasing by 2.4 million to 26.9 million euros and in 12 months 87.2% (2017: 84.0%), increasing by 19.4 million to 105.4 million euros.

The Group's largest market was Finland, where 51.2% in Q4 and 62.5% in 12-months period of the Group's products and services were sold (75.4% and 73.0%, respectively in 2017). In the quarterly comparison, sale to the Finnish market has decreased by 5.3 million euros to 16.2 million, which was caused of the decline in the orders of Finnish grid companies. Compared to the previous year, Finnish sales remained almost at the same level, i.e. 75.5 (2017: 74.7) million euros.

Sales to Sweden increased the most, with a nearly 10-fold rise to 5.1 million euros in the fourth quarter in comparison with the reference period, and a 5-fold increase to 13.5 million euros in the comparison of years. The Swedish market accounted for 16.2% of the Group's total sales revenue in the reporting quarter (Q4 2017: 1.8%) and 11.2% in the financial year (2017: 2.7%). Growth was driven by the acquisition of Swedish subsidiaries as well as targeted sales by other companies in the Group, which resulted in contractual deliveries to Sweden's largest grid company E. ON Energidistribution AB.

Of the most important markets, sales to the Norwegian market also continued to grow, reaching 3.0 million euros in the reporting quarter and 8.7 million euros during the year, forming 9.6% (Q4 2017: 8.2%) of the consolidated sales revenue for the reporting quarter and 7.2% of the consolidated sales revenue for the year (2017: 5.7%). As the Lithuanian subsidiary earned 98.2% (2017: 87.7%) of the sales revenue of the financial year outside the home market, the share of the Lithuanian market in the Group's sales revenue was minimal, being 0.1% in the reporting quarter and 0.3% in the year. Although sales to the Estonian market in the fourth quarter increased by 16.4% to 4.8 million euros, accounting for 15.1% (Q4 2017: 14.3%) of the consolidated sales revenue for the reporting quarter, it fell by 5.8% to 15.4 million euros over the year. The main reason for the decline was the continued low level of investment in the energy distribution sector, as well as intense competition. The largest of the Group's other markets was the Netherlands, which generated 1.3 million euros of sales revenue in the reporting quarter and 3.0 million euros of sales revenue in the accounting year. The Austrian and Danish markets earned an annual revenue of 1.7 million euros and 0.9 million euros respectively.

In Q4 2018, an average of 727 employees worked in the Group, which was 107 people more than in the comparable period. In the 12-months period, an average of 713 employees worked in the Group, which was 146 people more than in the reference period. At the end of the reporting period, there were 736 people working in the Group, which was 106 persons more than a year earlier. With the acquisition of Swedish subsidiaries, 45 employees were added to the Group. In the reporting quarter, 4,493 (Q4 2017: 4,127) thousand euros and 18,539 (2017: 14,073) thousand euros during the year were paid to the employees as salaries and fees. In 2018, the average monthly salary per employee of the Group was 2,166 euros, an average increase by 5% compared to the reference period.

In Q4, the Group’s operating profit was 1,007 (Q4 2017: 1,404) thousand euros and EBITDA 1,701 (Q4 2017: 2,345) thousand euros. Return of sales for the reporting quarter was 3.2% (Q4 2017: 4.9%) and return of sales before depreciation 5.4% (Q4 2017: 8.2%).

In 2018, the Group’s operating profit was 2,413 (2017: 5,442) thousand euros and EBITDA 5,001 (2017: 7,587) thousand euros. Return of sales for the reporting year was 2.0% (2017: 5.3%) and return of sales before depreciation 4.1% (2017: 7.4%). Integrating newly acquired businesses and preparations for new and already won procurements continue, leading to higher development and distribution costs, and due to hiring new specialists, increase labour costs. The profitability was also affected by one-off expenses due to the move of AS Harju Elekter Teletehnika into new premises and re-certification of subsidiaries' quality and environmental management systems.

The net profit before taxes for the reporting quarter was 996 (Q4 2017: 1,234) thousand euros. The calculated income tax expense for the last three months was 260 (Q4 2017: 288) thousand euros. The 12-month consolidated profit before tax was 2,507 (2017: 30,215) thousand euros and the calculated income tax was 993 (2017: 1,083) thousand euros.

In Q4, the consolidated net profit was 736 (Q4 2017: 946) thousand euros, of which the share of the owners of the Company was 735 (Q4 2017:976) thousand euros. All in all, the consolidated net profit in the reporting year was 1,514 (2017: 29,132) thousand euros, of which the share of the owners of the Company was 1,546 (2017: 29,129) thousand euros. In 2018, EPS was 0.09 euros (2017: 1.64 euros). In 2017, a one-time gain of 24,839 thousand euros was received from the sale of PKC Group Oyj shares. The consolidated net profit for the comparable period without extraordinary income was 4,293 thousand euros and EPS was 0.24 euros.

In 2018, the Group has made a total of 10.6 (2017: 9.1) million euros worth of investments to fixed assets. The ongoing developments in Allika Industrial Park and in the construction of the Haapsalu solar plant in amount of 2.5 million euros.

In the end of the year, the share of Harju Elekter in Nasdaq Tallinn 4.12 euros.

Andres Allikmäe
Chairman of the Management Board
+372 674 7400

For more information: Tiit Atso, CFO, +372 674 7400 or Interim report 1-12/2018

AS HARJU ELEKTER        
CONSOLIDATED BALANCE SHEET,31.12.2018        
Unaudited        
         
EUR'000        
ASSETS                                                   31.12.18 31.12.17    
Cash and cash equivalents 3,142 10,992    
Short-term financial investments 0 9,935    
Trade receivables and other receivables 22,218 13,575    
Prepayments 1,173 1,174    
Inventories 17,468 13,037    
TOTAL CURRENT ASSETS                     44,001 48,713    
Deferred income tax asset 98 56    
Other long-term financial investments 9,587 4,684    
Investment property 19,804 17,881    
Property, plant and equipment 17,403 11,983    
Intangible assets 7,260 6,660    
TOTAL NON-CURRENT ASSETS 54,152 41,264    
TOTAL ASSETS                              98,153 89,977    
LIABILITIES AND OWNERS' EQUITY                   
Interest-bearing loans and borrowings 6,470 625    
Advances from customers 1,740 1,088    
Trade payables and other payables 14,911 12,802    
Tax liabilities   2,409 2,376    
Short-term provision 14 245    
TOTAL CURRENT LIABILITIES                 25,544 17,136    
Interest-bearing loans and borrowings 5,635 2,910    
Other long-term liabilities 35 0    
NON-CURRENT LIABILITIES             5,670 2,910    
TOTAL LIABILITIES                         31,214 20,046    
Share capital                             11,176 11,176    
Share premium 804 804    
Reserves 2,568 2,844    
Retained earnings                         52,412 55,048    
TOTAL OWNERS' EQUITY                       66,960 69,872    
Non-controlling interests -21 59    
TOTAL EQUITY                       66,939 69,931    
TOTAL LIABILITIES AND OWNERS' EQUITY      98,153 89,977    
         
         
CONSOLIDATED INCOME STATEMENT,  1-12/2018        
Unaudited        
         
EUR’000 Q4 2018 Q4 2017 12m 2018 12m 2017
         
Revenue 31,669 28,552 120,804 102,402
Cost of sales -26,802 -24,248 -104,828 -87,043
Gross profit 4,867 4,304 15,976 15,359
Distribution costs -1,623 -1,059 -5,267 -3,866
Administrative expenses -2,224 -1,820 -8,223 -5,981
Other income 64 10 124 50
Other expenses -77 -31 -197 -120
Operating profit 1,007 1,404 2,413 5,442
Gain on sale of financial assets 0 0 0 24,839
Finance income 16 20 157 30
Finance costs -27 -190 -63 -96
Profit before tax 996 1,234 2,507 30,215
Income tax expense -260 -288 -993 -1,083
Profit for the period, attributable to 736 946 1,514 29,132
   owners of the Company 735 976 1,546 29,129
   non-controlling interests 1 -30 -32 3
Basic earnings per share  (EUR) 0.04 0.06 0.09 1.64
Diluted earnings per share  (EUR) 0.04 0.06 0.09 1.64

Tiit Atso
CFO
+372 674 7400