Lemminkäinen and YIT will complete the merger
- Stock Exchange Releases
- 8/7/2008
Lemminkäinen´s Interim Financial Review 1.1. - 30.6.2008: Net sales rose 24 %
LEMMINKÄINEN CORPORATION INTERIM FINANCIAL REVIEW 7.8.2008, 09:00 LEMMINKÄINEN'S INTERIM FINANCIAL REVIEW 1.1. - 30.6.2008: Net sales rose 24 % - Net sales rose 24 % to EUR 1,090.8 million (879.9) - International operations accounted for EUR 282.4 million (212.6) of net sales - The operating profit was EUR 31.8 million (45.3), representing 2.9 % (5.1) of net sales. - The profit before taxes was
LEMMINKÄINEN CORPORATION INTERIM FINANCIAL REVIEW 7.8.2008, 09:00
LEMMINKÄINEN'S INTERIM FINANCIAL REVIEW 1.1. - 30.6.2008: Net sales rose 24 %
- Net sales rose 24 % to EUR 1,090.8 million (879.9)
- International operations accounted for EUR 282.4 million (212.6) of net sales
- The operating profit was EUR 31.8 million (45.3), representing 2.9 % (5.1) of
net sales.
- The profit before taxes was EUR 19.4 million (38.9)
- Earnings per share were EUR 0.71 (1.55)
- The equity ratio was 23.9 % (26.6) and gearing 171.5 % (146.0)
- The Company's order book at the end of the review period was EUR 1,696.7
million
(1,622.0)
- International business accounted for EUR 456.4 million (449.3) of the order
book
- The Group's full-year net sales are expected to be higher than last year, but
profits are forecast to remain at the 2007 level
NET SALES ROSE, PROFITS WEAKENED
Lemminkäinen's net sales grew 24 % in the first half of the year. The volume of
business grew in all of the Company's key business sectors both in Finland and
abroad. The Group's order book was 5 per cent higher than at the end of June
last year.
Lemminkäinen's H1 operating profit was EUR 31.8 million (45.3). The profit
before taxes was EUR 19.4 million (38.9) and the profit for the accounting
period was EUR 14.0 million (29.9).
Profits weakened significantly in the Lemminkäinen's building construction and
infrastructure construction business sectors. On the other hand, there was a
marked improvement in the profits of the Company's technical building services
business sector. The profitability of the building products business sector
remained unchanged.
Even though the production of commercial buildings continued to be brisk, the
timing of their margin recognition was such that exceptionally few were included
in the review period. In infrastructure construction, especially paving, the
rapid growth of input costs somewhat weakened the business sector's
profitability, although efforts to hedge against rising raw material prices were
quite successful. Longer selling times of housing units delayed the recognition
of housing production margins and increased the amount of capital tied up in
production. Also, other operating income recognised in the first half of last
year was EUR 6.4 million higher than in the review period.
VARIABILITY IN MARKET CONDITIONS
In Finland the market for commercial and logistics construction is still good.
Higher interest rates and accelerating inflation are increasing uncertainty on
the housing market, and the selling times of housing units have grown
considerably longer than last year. In Russia building construction continues to
be brisk. Demand for project exports has remained good in countries such as
Poland, Hungary, China and India.
In Finland, Lemminkäinen's on-going transport infrastructure projects will
ensure a reasonably good order book for infrastructure construction in 2008 and
2009. The market for mineral aggregates and ready-mix concrete has been
particularly good, but demand is expected to level off in the second half of the
year. The road construction market in the Baltic states has been growing for
some years, but competition in the region has become more intense.
The market for maintenance, servicing and repair of technical building and
facility systems is expected to remain good in Finland. Urban environment
construction will continue to be brisk in the second half of the year. Demand
for pre-cast concrete staircase units and façade elements has peaked.
OUTLOOK FOR 2008
Lemminkäinen's order book still stands at a record-high level. The Group's
full-year net sales are expected to be higher than last year, but profits are
forecast to remain at the 2007 level. The Company's financial position is
expected to remain unchanged.
BRIEFING
A briefing for analysts and the media will be held at 10:00 am on Thursday, 7
August at Katajanokan Kasino restaurant, Laivastokatu 1, Helsinki. Participants
are kindly asked to register in advance by contacting Investor Relations Officer
Katri Sundström either by phone +358 2071 53520 or by e-mail to
katri.sundstrom@lemminkainen.fi.
FINANCIAL INFORMATION IN 2008
Lemminkäinen's Q1-Q3 interim financial review will be published on 6 November
2008.
Presentation material concerning the result for the period 1.1.-30.6.2008 is
available on the Company's website at www.lemminkainen.com
LEMMINKÄINEN CORPORATION
Juhani Sormaala
Managing Director
Additional information:
Juhani Sormaala, Managing Director, tel. +358 2071 53302
Jukka Ovaska, Finance Director, tel. +358 2071 53334
Katri Sundström, Investor Relations Officer, tel. +358 2071 54813
APPENDICES:
Interim Financial Review 1.1.-30.6.2008
Tabulated Section of the Interim Financial Review
DISTRIBUTION:
OMX Nordic Exchange Helsinki
Key media
www.lemminkainen.com
INTERIM FINANCIAL REVIEW 1.1.-30.6.2008
OPERATING ENVIRONMENT
Finland
The Finnish economy is likely to grow by less than 3 per cent this year. The
outlook for the economy is overshadowed by the gathering pace of inflation,
which is being fuelled especially by the rapid growth of crude oil and food
prices. Higher interest rates are causing uncertainty on the housing market.
According to the Confederation of Finnish Construction Industries, the total
volume of construction will grow by about 4 per cent this year. It is
anticipated that a total of 28,000 new housing starts will be made in Finland
this year, compared with about 30,800 in 2007. The selling times of housing
units have clearly grown longer and the number of unsold completed units has
risen.
Demand for commercial and logistics construction has continued at a good level,
but office construction is expected to slow down in the second half. The market
for industrial construction is good and refurbishment contracting continues to
grow steadily.
The infrastructure construction market has remained reasonably good and
foundation engineering works in particular have been in sufficient demand.
(Sources: Confederation of Finnish Construction Industries, Bank of Finland)
Relevant markets for Lemminkäinen abroad
In the other Nordic countries, with the exception of Denmark, economic growth in
2008 is expected to be slightly higher than the average growth rate for the euro
zone.
In the Baltic states, there has been a significant downward revision of growth
forecasts. The economic outlook for the region is being weakened by accelerating
inflation in particular. New road construction and upgrade projects are still
being launched with foreign funding.
The Russian economy continues to grow robustly and foreign investments are
expected to maintain their growth. Demand for construction is still good in
Russia.
Finnish industry has many on-going investment projects in China, India and
Eastern Europe. The construction of 3G networks continues in the United States
and Latin America, as does the deployment of second-generation GSM networks in
the developing countries.
(Sources: Euroconstruct, Research Institute of the Finnish Economy)
LEMMINKÄINEN'S NEW STRUCTURE EFFECTIVE FROM 1.1.2008
Lemminkäinen Group was reorganised into four business sectors with effect from 1
January 2008. The business sectors are building construction, infrastructure
construction, technical building services and building products.
Lemminkäinen's operations in the building construction and infrastructure
construction business sectors are the responsibility of two newly established
companies, Lemminkäinen Talo Oy and Lemminkäinen Infra Oy, respectively.
Tekmanni Oy is a provider of technical building services, technical facility
services and industrial services. The building products business sector,
Lemminkäinen Building Products, comprises the subsidiaries Lemminkäinen Katto Oy
(roofing), Lemminkäinen Betonituote Oy (concrete products) and Omni-Sica Oy
(sports construction).
More detailed information on Lemminkäinen's reorganisation is provided in the
Company's Annual Report 2007 and on its website.
The comparative figures presented in this interim financial review for the
building construction and infrastructure construction business sectors are pro
forma figures.
GROUP NET SALES, EARNINGS AND BALANCE SHEET
The H1 net sales of Lemminkäinen Group rose 24 % to EUR 1,090.8 million (879.9).
The Group generated 74 % (76) of its net sales in Finland, 13 % (14) in other
Nordic countries, 4 % (1) in Russia, 6 % (5) in Eastern Europe and the Baltic
states, and 3 % (4) in other countries.
--------------------------------------------------------------------------------
| Net sales by business sector, | 1-6/2008 | 1-6/2007 | Change, % |
| EUR million | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Building construction | 571.9 | 442.31) | 29.3 |
--------------------------------------------------------------------------------
| Infrastructure construction | 346.0 | 301.41) | 14.8 |
--------------------------------------------------------------------------------
| Technical building services | 124.4 | 103.4 | 20.3 |
--------------------------------------------------------------------------------
| Building products | 70.8 | 58.1 | 21.9 |
--------------------------------------------------------------------------------
| Other operations and intragroup | | | |
--------------------------------------------------------------------------------
| eliminations | -22.3 | -25.3 | 11.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Group, total | 1,090.8 | 879.9 | 24.0 |
--------------------------------------------------------------------------------
1)pro forma
The H1 operating profit was EUR 31.8 million (45.3) and the profit before taxes
EUR 19.4 million (38.9). The profit for the accounting period was EUR 14.0
million (29.9), of which EUR 12.1 million (26.5) was attributable to the
shareholders of the parent company. Earnings per share were EUR 0.71 (1.55).
--------------------------------------------------------------------------------
| Operating profit by business | 1-6/2008 | 1-6/2007 | Change, % |
| sector, | | | |
| EUR million | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Building construction | 21.4 | 31.81) | -32.7 |
--------------------------------------------------------------------------------
| Infrastructure construction | 4.0 | 8.01) | -50.0 |
--------------------------------------------------------------------------------
| Technical building services | 8.1 | 4.6 | 76.1 |
--------------------------------------------------------------------------------
| Building products | 3.4 | 3.4 | 0.0 |
--------------------------------------------------------------------------------
| Others | -5.1 | -2.6 | 96.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Group, total | 31.8 | 45.3 | -29.8 |
--------------------------------------------------------------------------------
1)pro forma
The Company's cash funds at the end of the review period were EUR 76.0 million
(55.3) and the net interest-bearing debt EUR 515.6 million (391.2). The equity
ratio was 23.9 % (26.6) and gearing 171.5 % (146.0).
The Group's order book grew 5 % and at the end of the review period was EUR
1,696.7 million (1,622.0). The market breakdown of the order book was Finland 73
% (72), other Nordic countries 14 % (15), Russia 5 % (6), Eastern Europe and the
Baltic states 6 % (4), and other countries 2 % (3).
BUSINESS SECTORS
BUILDING CONSTRUCTION
The H1 net sales of the building construction business sector rose 29 % to EUR
571.9 million (442.3)1), of which international operations accounted for EUR
115.7 million (75.1)1). The business sector generated 80 % of its net sales in
Finland, 5 % in other Nordic countries, 5 % in Russia, 4 % in North and South
America, and 6 % in other countries. The growth in net sales was due to active
commercial and office construction in Finland as well as building construction
in Russia.
The business sector's H1 operating profit was EUR 21.4 million (31.8)1). Even
though the production of commercial buildings continued to be brisk, the timing
of their margin recognition was such that exceptionally few were included in the
review period. Longer selling times of housing units delayed the recognition of
housing production margins and increased the amount of capital tied up in
production. Also, other operating income recognised in the first half of last
year was higher than in the review period.
The order book at the end of the review period was EUR 919.9 million (947.9)1),
of which international operations accounted for EUR 165.5 (172.4)1).
1)pro forma
Operations in Finland
Lemminkäinen made 492 (H1 2007: 450, H1 2006: 842) new private-sector housing
starts in Finland during the review period. The Company expects to make starts
on approx. 700 new housing units in Finland this year (2007: 852, 2006: 1,558).
The selling times of housing units are clearly longer than they were last year
and higher interest rates have increased uncertainty in the housing market.
According to the consumer barometer (7/2008) published by Statistics Finland,
consumers´ expectations about their own economic situation were the most
cautious since 1996.
The market for commercial, industrial and logistics construction is still good.
Office construction has been brisk especially in the Helsinki metropolitan area,
but the number of new starts is expected to fall off in the second half of the
year. The investment returns demanded by commercial property investors have
risen due to higher interest rates and the tighter requirements of financiers.
There are regional variations in the sufficiency and need for labour, and there
is still a shortage of professionally skilled labour in the Helsinki
metropolitan area in particular.
--------------------------------------------------------------------------------
| Lemminkäinen's private-sector | 1-6/2008 | 1-6/2007 | 1-12/2007 |
| housing production in Finland, | | | |
| units | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Housing starts | 492 | 450 | 852 |
--------------------------------------------------------------------------------
| Housing units sold | 430 | 518 | 883 |
--------------------------------------------------------------------------------
| Unsold completed units | 286 | 186 | 283 |
--------------------------------------------------------------------------------
| Completed | 304 | 711 | 1,488 |
--------------------------------------------------------------------------------
| Under construction at 30.6.2008 | 1,311 | 1,437 | 1,123 |
--------------------------------------------------------------------------------
At the end of the review period Lemminkäinen owned a total of 862,000 m2 of
unused building rights, of which about 396,000 m2 were residential building
rights. The Company also has binding or conditional co-operation and zoning
agreements for a further 761,000 m2, of which about 258,000 m2 are residential
building rights. Market conditions permitting, the Company has the possibility
to increase its housing production in Finland thanks to the good stock of
building plots. At the present rate of production the company owns enough unused
building rights to meet its needs for over four years.
International operations
In Russia, construction continues to be brisk and foreign investments in the
country have grown. However, the country's sharply increased rate of inflation
and its possible impact on demand for housing are a concern.
Lemminkäinen is building over 600 housing units in St. Petersburg. Sales of the
526-unit Alexandria building will commence in the autumn. The Company is also
starting to construct a 135-hectare industrial park in the province of Kaluga.
Lemminkäinen is actively involved in Finnish industry's plant building projects
around the world. Project export opportunities are expected to remain good in
Poland, China and India. The construction of telecom networks in the developing
countries is expected to remain brisk, although price competition in this area
is fierce.
On spring 2006 IKEA announced the termination of its contract with Lemminkäinen
concerning the construction of the MEGA shopping centre in St. Petersburg.
Termination of the contract is not expected to have any essential bearing on
Lemminkäinen´s result. Legal proceedings are now underway in the court of
arbitration in Stockholm.
--------------------------------------------------------------------------------
| Lemminkäinen's private-sector housing | 1-6/2008 | 1-12/2007 |
| production in other countries, units | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Housing starts | 607 | 91 |
--------------------------------------------------------------------------------
| Housing units sold | 55 | - |
--------------------------------------------------------------------------------
| Unsold completed units | - | - |
--------------------------------------------------------------------------------
| Completed | - | - |
--------------------------------------------------------------------------------
| Under construction at 30.6.2008 | 698 | 91 |
--------------------------------------------------------------------------------
INFRASTRUCTURE CONSTRUCTION
The H1 net sales of the infrastructure construction business sector grew 15 % to
EUR 346.0 million (301.4)1), of which international operations accounted for EUR
158.7 million (127.8)1). The business sector generated 54 % of its net sales in
Finland, 31 % in other Nordic countries, 13 % in the Baltic states and 2 % in
Russia. Net sales grew in almost all of the sector's business areas.
The business sector's H1 operating profit was EUR 4.0 million (8.0)1). The
difference compared with H1 last year is due to higher input costs and the lower
level of other operating income.
The order book grew 16 % and at the end of the review period was EUR 603.4
million (521.6)1), of which international operations accounted for EUR 289.2
million (270.9)1).
1)pro forma
Operations in Finland
The volume of Lemminkäinen's paving operations in Finland was up on the same
period last year. Competition in the paving industry continues to be fierce and
higher raw material prices may be reflected in the demand for paving in the
second half of the year. Nonetheless, the total volume of paving in Finland in
2008 is likely to remain at last year's level.
Competition is fierce on the domestic markets for transport infrastructure
construction and rock engineering. Lemminkäinen's on-going transport
infrastructure projects will ensure that the Company has a reasonable stock of
orders this year and in 2009. On the foundation engineering market, demand for
stabilisation and building repair works has remained good.
The markets for mineral aggregates and ready-mix concrete have been particularly
good, but demand is expected to level off in the second half of the year.
During the review period Lemminkäinen acquired full ownership of Tolarock Oy, a
rock engineering company specialised in hard rock tunnelling and mining
excavation. Demand for mining operations is expected to remain good and even to
increase in the near future.
International operations
The volume of the infrastructure construction business sector's international
operations grew in almost all the company's market areas. The international
order book remains good, but rapidly increased input costs adversely impacted
the business sector's result. Asphalt production costs have risen 10-15 per cent
and wage costs 5-15 per cent compared with last year.
This year the total volume of paving works is expected to rise in Norway,
Lithuania and Latvia. In Denmark and Estonia total volumes will either remain
unchanged or fall slightly compared with last year. In the Baltic states the
development of the road network will continue, but competitive conditions in the
region have become more challenging.
In Sweden the rock engineering market remains good, but competition has
intensified with the market entry of new actors mainly from Europe. During the
review period Lemminkäinen received two tunnel construction contracts from
Ådalsbana. The combined value of the contracts is approx. EUR 43 million.
TECHNICAL BUILDING SERVICES
The H1 net sales of the technical building services business sector rose by a
fifth to EUR 124.4 million (103.4). Business volume grew in all areas of the
business sector.
The H1 operating profit rose by as much as 76 % to EUR 8.1 million (4.6). The
order book at the end of the review period was EUR 120.5 million (106.0).
Brisk commercial construction has sustained demand for technical building
services at a good level, but uncertainty as to the sector's cyclical
development will continue for the remainder of the year. The sector continues to
experience a general shortage of skilled labour.
The market for maintenance, servicing and repair work has continued its steady
growth. There is also demand in Russia, where Tekmanni Service Oy set up
operations in 2007.
BUILDING PRODUCTS
The H1 net sales of the building products business sector grew 22 % to EUR 70.8
million (58.1). The business sector generated 9 % of its net sales abroad.
The H1 operating profit was EUR 3.4 million (3.4). The order book grew and at
the end of the review period was EUR 52.9 million (46.5).
Urban environment and sports construction have been clearly more active than in
2007, and the outlook for these markets in the second half of the year is good.
The slowdown of housing and office construction has weakened demand for pre-cast
concrete staircase units and wall elements.
Exports of building materials mainly to Sweden and Eastern Europe have continued
to be brisk.
GROUP'S ORDER BOOK
Lemminkäinen's order book rose 5 % compared with the end of June last year. The
market breakdown of the order book was Finland 73 % (72), other Nordic countries
14 % (15), Russia 5 % (6), the Baltic states and Eastern Europe 6 % (4), and
other countries 2 % (3).
--------------------------------------------------------------------------------
| Order book by business sector, | 6/2008 | 6/2007 | Change, % |
| EUR million | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Building construction | 919.9 | 947.91) | -3.0 |
--------------------------------------------------------------------------------
| Infrastructure construction | 603.4 | 521.61) | 15.7 |
--------------------------------------------------------------------------------
| Technical building services | 120.5 | 106.0 | 13.7 |
--------------------------------------------------------------------------------
| Building products | 52.9 | 46.5 | 13.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Group, total, of which | 1,696.7 | 1,622.0 | 4.6 |
--------------------------------------------------------------------------------
| International orders | 456.4 | 449.3 | 1.6 |
--------------------------------------------------------------------------------
1)pro forma
Significant orders received during the review period
Lemminkäinen is constructing a production plant for Nokia Siemens Networks Oy in
Chennai, India. The total floor area of the plant is 33,700 m2.
An agreement has been signed with Nokian Tyres Plc concerning the technical
building works for a plant expansion in Vsevolozhsk. The total floor area of the
plant expansion is 29,000 m².
A service agreement has been signed with the Estonian Road Administration
whereby the company assumes responsibility for the summer and winter maintenance
of the road network in Ida-Viru County for a period of 8 years.
In Russia Lemminkäinen has received a Remix road resurfacing contract for a
section of the M-18 highway leaving the city of Murmansk. The road section is
150 km long and the work will be carried out during the summer by personnel and
equipment normally based in Finland.
Lemminkäinen has received two railway tunnel construction contracts from
Ådalsbana line in Sweden. The combined length of the tunnels is about 5.5
kilometres and the work will take an estimated two years to complete.
FINANCING
According to the cash flow statement, the cash flow from operating activities
was EUR -174.6 million (-54.8), the cash flow from investing activities EUR
-23.8 million (-19.3) and the cash flow from financing activities EUR 195.9
million (68.6). The cash flow for the review period includes dividends totalling
EUR 32.6 million (27.4) for 2007.
Interest-bearing liabilities at the end of the review period were EUR 591.7
million (446.6) and liquid funds were EUR 76.0 million (55.3). Interest-bearing
net debt was EUR 515.6 million (391.2). Net financing expenses were EUR 12.7
million (6.3), representing 1.2 % (0.7) of net sales.
The equity ratio was 23.9 % (26.6) and gearing 171.5 % (146.0).
The changes in cash flows and the amount of interest-bearing net debt are mainly
due to increased working capital, as a consequence of net sales growth. The
higher financing costs are due to increased working capital, higher interest
rates, exchange rate changes and hedges.
LEMMINKÄINEN'S SHARE
The listed price of Lemminkäinen Corporation's share was EUR 31.50 (36.10) at
the beginning and EUR 29.01 (52.45) at the end of the review period. The market
capitalisation at the end of the review period was EUR 493.8 million (892.8).
Altogether 2,157,846 (3,139,388) shares worth EUR 68.0 million (141.3) were
traded in the first half of the year. At the end of the review period the
Company had 4,094 (3,357) shareholders.
INVESTMENTS
Investments in the accounting period amounted to EUR 35.6 million (37.4). The
investments were mainly purchases of paving, crushing and excavation equipment,
production plant for building materials, and building construction equipment.
PERSONNEL
The average number of employees in the Group over the review period was 9,498
(8,762). Approx. 71 % (72) of the employees were working in Finland, 11 % (11)
in other Nordic countries, 11 % (11) in the Baltic states, and 7 % (6) in other
countries.
--------------------------------------------------------------------------------
| Personnel, average | 1-6/2008 | 1-6/2007 | Change, % |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Hourly paid employees | 6,262 | 5,662 | 10.6 |
--------------------------------------------------------------------------------
| Salaried staff | 3,236 | 3,100 | 4.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel, total, of whom | 9,498 | 8,762 | 8.4 |
--------------------------------------------------------------------------------
| Working abroad | 2,692 | 2,482 | 8.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel at the end | | | |
--------------------------------------------------------------------------------
| of the review period | 10,919 | 10,397 | 5.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Wages, salaries and other | | | |
--------------------------------------------------------------------------------
| remuneration, EUR million | 168.2 | 147.3 | 14.2 |
--------------------------------------------------------------------------------
CORPORATE GOVERNANCE AND DECISIONS OF THE ANNUAL GENERAL MEETING
Lemminkäinen Corporation's Annual General Meeting held on 14 March 2008 adopted
the Company's final accounts and consolidated financial statements for 2007 and
granted the Managing Director and the members of the Board of Directors
discharge from liability. The Annual General Meeting decided in accordance with
the Board of Directors' proposal to pay a dividend of EUR 1.80 per share, i.e. a
total dividend pay-out of EUR 30,638,250.00. The dividend's record date was 19
March 2008 and the payment date was 28 March 2008.
Messrs. Berndt Brunow, Heikki Pentti, Teppo Taberman, Sakari Tamminen and Ms.
Kristiina Pentti were re-elected to serve as members of the Board of Directors.
Mr. Juhani Mäkinen, Counsellor of Law, attorney, was newly elected to serve as a
Board member. PricewaterhouseCoopers Oy, a firm of authorised public
accountants, was re-elected to serve as the Company's auditor, with Jan
Holmberg, APA acting as the chief auditor.
Heikki Pentti, long-serving Chairman of Lemminkäinen Corporation's Board of
Directors and the Company's biggest shareholder, passed away on 19 April 2008
after a serious illness. Heikki Pentti was a Director of the Company for 39
years. He served as the Company's Managing Director in the years 1983-1993 and
as the Chairman of the Board of Directors from 1994 onwards.
Lemminkäinen Corporation's Board of Director held an organisation meeting after
the death of Heikki Pentti. Berndt Brunow was elected to serve as the Chairman
of the Board, and Juhani Mäkinen as the Vice Chairman. The Board of Directors
will work as a five-member body until the next Annual General Meeting is held in
spring 2009.
MARKET COURT'S DECISION IN THE ASPHALT INDUSTRY CARTEL CASE
In December 2007 the Market Court ordered seven asphalt industry companies to
pay a total of EUR 19.4 million in infringement fines for contravention of
competition law. The infringement fine imposed on Lemminkäinen was EUR 14
million. The amount proposed by the Finnish Competition Authority was EUR 68
million.
In addition to Lemminkäinen, the Finnish Competition Authority and some asphalt
industry companies have appealed the decision to the Supreme Administrative
Court. Irrespective of the future of the proceedings, the competition
infringement fine of EUR 14 million imposed on Lemminkäinen by the Market Court
was recognised as an expense in the fourth quarter of 2007. Since the decision
has been appealed, the total amount of the fine may change.
On 18 June 2008 Lemminkäinen was informed of an application for a summons in
which the Finnish Road Administration is demanding compensatory damages from
different asphalt companies before the Helsinki District Court. Lemminkäinen's
share of the claimed compensation is at most EUR 10.5 million. The Finnish Road
Administration is also seeking damages of at most EUR 5.6 million from
Lemminkäinen, under joint and several liability with other defendant companies.
The Finnish Road Administration has asked the Helsinki District Court to
postpone the hearing of the case until the competition restriction case has been
resolved in the Supreme Administrative Court. (Bulletins 19.12.2007 and
18.6.2008)
RISKS AND UNCERTAINTIES IN THE NEAR FUTURE
The most significant risk for Lemminkäinen in the near future is market risk.
International financial market turbulence has partially extended to Finland and
may increasingly reflect on housing demand and other investments. Sales of
housing units in Finland are already clearly slower than they were last year.
The starting point for Lemminkäinen's strategy is to direct operations to
business sectors that differ from one another in their business cycle
behaviours. Fluctuations in the demand for new construction in Finland are
balanced by international business operations as well as by building repair and
maintenance work. The Group's building repair and maintenance operations account
for approximately 40% of its business.
During the review period Lemminkäinen's management did not identify any new
risks or uncertainties that, if realised, would have a significant bearing on
the Group's business. The Company's Annual Report and its website provide more
information on Lemminkäinen's risk management.
THE ENVIRONMENT
Lemminkäinen's values include environmentally responsible construction.
Lemminkäinen Group takes into account life-cycle and environmental perspectives
when developing its operations, products and services. Environmental issues and
the environmental effects of the Group's operations are continuously managed by
means internal monitoring and control programs. The Company's Annual Report and
its website provide more information on Lemminkäinen's environmental issues.
OUTLOOK FOR 2008
Lemminkäinen's order book still stands at a record-high level. The Group's
full-year net sales are expected to be higher than last year, but profits are
forecast to remain at the 2007 level. The Company's financial position is
expected to remain unchanged.
Helsinki, 6 August 2008
LEMMINKÄINEN CORPORATION
Board of Directors
TABULATED SECTION OF THE INTERIM FINANCIAL REVIEW
This interim financial review has been prepared in accordance with the
recognition and accounting principles of the IFRS standards and it conforms to
the IAS 34 Interim Financial Reporting Standard. The same IFRS recognition and
measurement principles used in the annual financial statements for 2007 have
been observed in the preparation of this interim financial review with the
below-mentioned changes.
Changes in accounting principles with effect from 1 January 2008:
- IFRIC 11 concerning the application of IFRS 2 to share-based payments
- IFRIC 12 Service Concession Arrangements
- IFRIC 14, IAS 19 The Limit and
Defined Benefit Assets, Minimum Funding Requirements and their Interaction
Adoption of the new interpretations does not have any essential bearing on the
Group's interim financial review.
The information contained in the interim financial review has not been audited.
--------------------------------------------------------------------------------
| FINANCIAL STATEMENTS AND OTHER TABULATED INFORMATION |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Consolidated income statement |
--------------------------------------------------------------------------------
| 2) Consolidated balance sheet |
--------------------------------------------------------------------------------
| 3) Consolidated cash flow statement |
--------------------------------------------------------------------------------
| 4) Consolidated statement of changes in shareholders' equity |
--------------------------------------------------------------------------------
| 5) Consolidated income statement, quarterly |
--------------------------------------------------------------------------------
| 6) Net sales by business sector |
--------------------------------------------------------------------------------
| 7) Net sales by business sector, quarterly |
--------------------------------------------------------------------------------
| 8) Operating profit by business sector |
--------------------------------------------------------------------------------
| 9) Operating profit by business sector, quarterly |
--------------------------------------------------------------------------------
| 10) Economic trends and financial indicators |
--------------------------------------------------------------------------------
| 11) Share-specific indicators |
--------------------------------------------------------------------------------
| 12) Tangible assets |
--------------------------------------------------------------------------------
| 13) Divested businesses |
--------------------------------------------------------------------------------
| 14) Acquired businesses |
--------------------------------------------------------------------------------
| 15) Related-party transactions |
--------------------------------------------------------------------------------
| 16) Guarantees and contingent liabilities |
| 17) Legal proceedings |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) CONSOLIDATED INCOME STATEMENT |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | 06/200 | 06/2007 | Change | Change, | 12/2007 |
| | 8 | | | | |
--------------------------------------------------------------------------------
| | | | | % | |
--------------------------------------------------------------------------------
| Net sales | 1,090. | 879.9 | 210.9 | 24.0 | 2,174.1 |
| | 8 | | | | |
--------------------------------------------------------------------------------
| Other operating | 4.1 | 10.5 | -6.4 | -61.0 | 13.2 |
| income | | | | | |
--------------------------------------------------------------------------------
| Operating expenses | 1,048. | 831.3 | 217.5 | 26.2 | 2,026.8 |
| | 8 | | | | |
--------------------------------------------------------------------------------
| Depreciation | 14.3 | 13.8 | 0.5 | 3.6 | 34.2 |
--------------------------------------------------------------------------------
| Operating profit | 31.8 | 45.3 | -13.5 | -29.8 | 126.3 |
--------------------------------------------------------------------------------
| Financial expenses | 17.6 | 9.2 | 8.4 | 91.3 | 22.2 |
--------------------------------------------------------------------------------
| Financial income | 4.9 | 2.9 | 2.0 | 69.0 | 6.2 |
--------------------------------------------------------------------------------
| Share of the results | | | | over | |
| of | | | | | |
--------------------------------------------------------------------------------
| affiliated companies | 0.3 | 0.0 | 0.3 | 100 | 0.9 |
--------------------------------------------------------------------------------
| Profit/loss before | 19.4 | 38.9 | -19.5 | -50.1 | 111.2 |
| taxes | | | | | |
--------------------------------------------------------------------------------
| Income taxes | -5.4 | -9.0 | 3.6 | 40.0 | -30.6 |
--------------------------------------------------------------------------------
| Profit/loss for the | | | | | |
| accounting | | | | | |
--------------------------------------------------------------------------------
| period | 14.0 | 29.9 | -15.9 | -53.2 | 80.6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Distribution of the profit/loss for the | | | |
| accounting period | | | |
--------------------------------------------------------------------------------
| To parent company | 12.1 | 26.5 | -14.4 | -54.3 | 72.9 |
| shareholders | | | | | |
--------------------------------------------------------------------------------
| To minority | 1.9 | 3.4 | -1.5 | -44.1 | 7.6 |
| interests | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EPS calculated from profit/loss attributable to parent company shareholders |
--------------------------------------------------------------------------------
| Earnings per share, diluted and undiluted, |
--------------------------------------------------------------------------------
| EUR | 0.71 | 1.55 | | | 4.29 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 2) CONSOLIDATED BALANCE SHEET |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | 06/2008 | 06/2007 | | 12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current assets | | | | |
--------------------------------------------------------------------------------
| Tangible assets | 191.0 | 178.5 | | 176.1 |
--------------------------------------------------------------------------------
| Goodwill | 76.5 | 75.8 | | 75.1 |
--------------------------------------------------------------------------------
| Other intangible assets | 2.7 | 2.5 | | 2.6 |
--------------------------------------------------------------------------------
| Investments | 9.2 | 9.6 | | 9.7 |
--------------------------------------------------------------------------------
| Deferred tax asset | 9.4 | 8.0 | | 4.9 |
--------------------------------------------------------------------------------
| Other non-current receivables | 5.6 | 2.9 | | 3.7 |
--------------------------------------------------------------------------------
| Total | 294.3 | 277.2 | | 272.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current assets | | | | |
--------------------------------------------------------------------------------
| Inventories | 393.9 | 302.9 | | 330.9 |
--------------------------------------------------------------------------------
| Trade and other receivables | 614.8 | 476.7 | | 387.4 |
--------------------------------------------------------------------------------
| Cash funds | 76.0 | 55.3 | | 78.5 |
--------------------------------------------------------------------------------
| Total | 1,084.7 | 834.9 | | 796.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Assets, total | 1,379.0 | 1,112.1 | | 1,069.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Shareholders' equity and | | | | |
| liabilities | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity attributable to parent company shareholders |
--------------------------------------------------------------------------------
| Share capital | 34.0 | 34.0 | | 34.0 |
--------------------------------------------------------------------------------
| Share premium account | 5.8 | 5.8 | | 5.8 |
--------------------------------------------------------------------------------
| Revaluation reserve | 1.1 | 0.6 | | 0.2 |
--------------------------------------------------------------------------------
| Translation differences | -0.2 | 0.3 | | 0.1 |
--------------------------------------------------------------------------------
| Retained earnings | 224.8 | 182.5 | | 182.5 |
--------------------------------------------------------------------------------
| Profit/loss for the period | 12.1 | 26.5 | | 72.9 |
--------------------------------------------------------------------------------
| Shareholders' equity | | | | |
--------------------------------------------------------------------------------
| before minority interest | 277.6 | 249.6 | | 295.5 |
--------------------------------------------------------------------------------
| Minority interest | 23.1 | 18.3 | | 23.7 |
--------------------------------------------------------------------------------
| Shareholders' equity, total | 300.7 | 267.9 | | 319.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current liabilities | | | | |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 15.7 | 17.8 | | 12.9 |
--------------------------------------------------------------------------------
| Pension liabilities | 0.6 | 0.9 | | 0.6 |
--------------------------------------------------------------------------------
| Provisions | 2.2 | 2.1 | | 1.7 |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 118.3 | 167.7 | | 139.5 |
--------------------------------------------------------------------------------
| Other liabilities | 1.2 | 1.7 | | 1.9 |
--------------------------------------------------------------------------------
| Total | 138.0 | 190.1 | | 156.6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current liabilities | | | | |
--------------------------------------------------------------------------------
| Accounts payable and other | 461.3 | 369.6 | | 369.2 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Provisions | 5.7 | 5.5 | | 6.4 |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 473.3 | 278.9 | | 217.6 |
--------------------------------------------------------------------------------
| Total | 940.3 | 654.0 | | 593.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Shareholders' equity | | | | |
--------------------------------------------------------------------------------
| and liabilities, total | 1,379.0 | 1,112.1 | | 1,069.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 3) CONSOLIDATED CASH FLOW STATEMENT |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | 06/2008 | 06/2007 | | 12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit before extraordinary | 19.4 | 38.9 | | 111.2 |
| items | | | | |
--------------------------------------------------------------------------------
| Depreciation according to | 14.3 | 13.8 | | 34.2 |
| plan | | | | |
--------------------------------------------------------------------------------
| Other adjustments | 10.0 | -1.5 | | 7.7 |
--------------------------------------------------------------------------------
| Cash flow before change | | | | |
--------------------------------------------------------------------------------
| in working capital | 43.6 | 51.2 | | 153.1 |
--------------------------------------------------------------------------------
| Change in working capital | -174.0 | -84.8 | | -32.9 |
--------------------------------------------------------------------------------
| Financial items | -15.5 | -6.9 | | -17.9 |
--------------------------------------------------------------------------------
| Direct taxes paid | -28.8 | -14.3 | | -22.6 |
--------------------------------------------------------------------------------
| Cash flow from operating | -174.6 | -54.8 | | 79.6 |
| activities | | | | |
--------------------------------------------------------------------------------
| Cash flow provided by | 8.5 | 18.1 | | 24.3 |
| investing activities | | | | |
--------------------------------------------------------------------------------
| Cash flow used in investing | -32.4 | -37.4 | | -53.8 |
| activities | | | | |
--------------------------------------------------------------------------------
| Change in non-current | -0.8 | -0.9 | | -1.4 |
| receivables | | | | |
--------------------------------------------------------------------------------
| Change in short-term loans | 257.4 | 15.5 | | -50.3 |
--------------------------------------------------------------------------------
| Drawings of long-term loans | 6.3 | 105.0 | | 103.8 |
--------------------------------------------------------------------------------
| Repayments of long-term loans | -28.1 | -15.5 | | -39.6 |
--------------------------------------------------------------------------------
| Repayments of finance leasing | -6.3 | -8.2 | | -17.1 |
| debts | | | | |
--------------------------------------------------------------------------------
| Dividends paid | -32.6 | -27.4 | | -27.4 |
--------------------------------------------------------------------------------
| Cash flow from financing | 195.9 | 68.6 | | -32.0 |
| activities | | | | |
--------------------------------------------------------------------------------
| Change in cash funds | -2.5 | -5.5 | | 18.1 |
--------------------------------------------------------------------------------
| Cash funds at beginning of | 78.5 | 60.6 | | 60.6 |
| period | | | | |
--------------------------------------------------------------------------------
| Translation difference of | 0.0 | 0.2 | | -0.2 |
| cash funds | | | | |
--------------------------------------------------------------------------------
| Cash funds at end of period | 76.0 | 55.3 | | 78.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 4) CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | | | | | | Share- |
--------------------------------------------------------------------------------
| | | Share | Trans- | Revalu- | | | holders |
| | | | | | | | ' |
--------------------------------------------------------------------------------
| | Shar | premi | lation | ation | Retained | Minorit | equity, |
| | e | um | | | | y | |
--------------------------------------------------------------------------------
| EUR | capi | accou | differ | reserve | earnings | interes | total |
| milli | tal | nt | ence | | | t | |
| on | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share | | | | | | | |
| holde | | | | | | | |
| rs' | | | | | | | |
--------------------------------------------------------------------------------
| equit | | | | | | | |
| y | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1.1.2 | 34.0 | 5.8 | 0.1 | 0.1 | 208.0 | 19.7 | 267.7 |
| 007 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation | | | | | | |
--------------------------------------------------------------------------------
| difference | | 0.6 | | | | 0.6 |
--------------------------------------------------------------------------------
| Hedging of | | | | | | |
| net | | | | | | |
--------------------------------------------------------------------------------
| investment | | | | | | |
| in | | | | | | |
--------------------------------------------------------------------------------
| foreign | | | | | | |
--------------------------------------------------------------------------------
| subsidiary | | -0.4 | | | | -0.4 |
--------------------------------------------------------------------------------
| Cash flow | | | | | | |
--------------------------------------------------------------------------------
| hedges | | | 0.5 | | | 0.5 |
--------------------------------------------------------------------------------
| Change in | | | | | | |
--------------------------------------------------------------------------------
| fair value | | | 0.0 | | | 0.0 |
--------------------------------------------------------------------------------
| Rever | | | | | | | |
| sal | | | | | | | |
| of | | | | | | | |
--------------------------------------------------------------------------------
| divid | | | | | | | |
| end | | | | | | | |
--------------------------------------------------------------------------------
| liabi | | | | | 0.0 | | 0.0 |
| lity | | | | | | | |
--------------------------------------------------------------------------------
| Divid | | | | | | | |
| end | | | | | | | |
--------------------------------------------------------------------------------
| distr | | | | | -25.5 | -1.8 | -25.5 |
| ibuti | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
| Profi | | | | | | | |
| t/los | | | | | | | |
| s for | | | | | | | |
--------------------------------------------------------------------------------
| the | | | | | | | |
| accou | | | | | | | |
| nting | | | | | | | |
--------------------------------------------------------------------------------
| perio | | | | | 26.5 | 3.4 | 29.9 |
| d | | | | | | | |
--------------------------------------------------------------------------------
| Chang | | | | | | | |
| e in | | | | | | | |
--------------------------------------------------------------------------------
| minor | | | | | | | |
| ity | | | | | | | |
--------------------------------------------------------------------------------
| inter | | | | | | -3.0 | -4.8 |
| est | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share | | | | | | | |
| holde | | | | | | | |
| rs' | | | | | | | |
--------------------------------------------------------------------------------
| equit | | | | | | | |
| y, | | | | | | | |
--------------------------------------------------------------------------------
| 31.6. | 34.0 | 5.8 | 0.3 | 0.6 | 209.0 | 18.3 | 267.9 |
| 2007 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | | | | | | Share- |
--------------------------------------------------------------------------------
| | | Share | Trans- | Revalu- | | | holders |
| | | | | | | | ' |
--------------------------------------------------------------------------------
| | Shar | premi | lation | ation | Retained | Minorit | equity, |
| | e | um | | | | y | |
--------------------------------------------------------------------------------
| EUR | capi | accou | differ | reserve | earnings | interes | total |
| milli | tal | nt | ence | | | t | |
| on | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share | | | | | | | |
| holde | | | | | | | |
| rs' | | | | | | | |
--------------------------------------------------------------------------------
| equit | | | | | | | |
| y, | | | | | | | |
--------------------------------------------------------------------------------
| 1.1.2 | 34.0 | 5.8 | 0.1 | 0.1 | 208.0 | 19.7 | 267.7 |
| 007 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation | | | | | | |
--------------------------------------------------------------------------------
| difference | | 0.4 | | | | 0.4 |
--------------------------------------------------------------------------------
| Hedging of | | | | | | |
| net | | | | | | |
--------------------------------------------------------------------------------
| investment | | | | | | |
| in | | | | | | |
--------------------------------------------------------------------------------
| foreign | | | | | | |
--------------------------------------------------------------------------------
| subsidiary | | -0.4 | | | | -0.4 |
--------------------------------------------------------------------------------
| Cash | | | | | | | |
| flow | | | | | | | |
--------------------------------------------------------------------------------
| hedge | | | | 0.2 | | | 0.2 |
| s | | | | | | | |
--------------------------------------------------------------------------------
| Change in | | | | | | |
--------------------------------------------------------------------------------
| fair value | | | 0.0 | | | 0.0 |
--------------------------------------------------------------------------------
| Effect of | | | | | | |
--------------------------------------------------------------------------------
| sold shares | | | -0.1 | | | -0.1 |
--------------------------------------------------------------------------------
| Reversal of | | | | | | |
--------------------------------------------------------------------------------
| dividend | | | | | | |
--------------------------------------------------------------------------------
| liability | | | | 0.0 | | 0.0 |
--------------------------------------------------------------------------------
| Dividend | | | | | | |
--------------------------------------------------------------------------------
| distribution | | | | -25.5 | -1.9 | -27.4 |
--------------------------------------------------------------------------------
| Profit/loss | | | | | | |
| for | | | | | | |
--------------------------------------------------------------------------------
| the | | | | | | |
| accounting | | | | | | |
--------------------------------------------------------------------------------
| period | | | | 72.9 | 7.6 | 80.6 |
--------------------------------------------------------------------------------
| Change in | | | | | | |
--------------------------------------------------------------------------------
| minority | | | | | | |
--------------------------------------------------------------------------------
| interest | | | | | -1.7 | -1.7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Shareholders | | | | | | |
| ' | | | | | | |
--------------------------------------------------------------------------------
| equit | | | | | | | |
| y | | | | | | | |
--------------------------------------------------------------------------------
| 31.12 | 34.0 | 5.8 | 0.1 | 0.2 | 255.4 | 23.7 | 319.2 |
| .2007 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | | | | | | Share- |
--------------------------------------------------------------------------------
| | | Share | Trans- | Revalu- | | | holders |
| | | | | | | | ' |
--------------------------------------------------------------------------------
| | Shar | premi | lation | ation | Retained | Minorit | equity, |
| | e | um | | | | y | |
--------------------------------------------------------------------------------
| EUR | capi | accou | differ | reserve | earnings | interes | total |
| milli | tal | nt | ence | | | t | |
| on | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share | | | | | | | |
| holde | | | | | | | |
| rs' | | | | | | | |
--------------------------------------------------------------------------------
| equit | | | | | | | |
| y, | | | | | | | |
--------------------------------------------------------------------------------
| 1.1.2 | 34.0 | 5.8 | 0.1 | 0.2 | 255.4 | 23.7 | 319.2 |
| 008 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation | | | | | | |
--------------------------------------------------------------------------------
| differences | | -0.4 | | | | -0.4 |
--------------------------------------------------------------------------------
| Hedging of | | | | | | |
| net | | | | | | |
--------------------------------------------------------------------------------
| investment | | | | | | |
| in | | | | | | |
--------------------------------------------------------------------------------
| foreign | | | | | | |
--------------------------------------------------------------------------------
| subsidiary | | 0.2 | | | | 0.2 |
--------------------------------------------------------------------------------
| Cash | | | | | | | |
| flow | | | | | | | |
--------------------------------------------------------------------------------
| hedge | | | | 0.9 | | | 0.9 |
| s | | | | | | | |
--------------------------------------------------------------------------------
| Change in | | | | | | |
--------------------------------------------------------------------------------
| fair value | | | 0.0 | | | 0.0 |
--------------------------------------------------------------------------------
| Reversal of | | | | | | |
--------------------------------------------------------------------------------
| dividend | | | | | | |
--------------------------------------------------------------------------------
| liability | | | 0.0 | | | 0.0 |
--------------------------------------------------------------------------------
| Dividend | | | | | | |
--------------------------------------------------------------------------------
| distribution | | | | -30.6 | -2.0 | -32.6 |
--------------------------------------------------------------------------------
| Profit/loss | | | | | | |
| for | | | | | | |
--------------------------------------------------------------------------------
| the | | | | | | |
| accounting | | | | | | |
--------------------------------------------------------------------------------
| period | | | | 12.1 | 1.9 | 14.0 |
--------------------------------------------------------------------------------
| Change in | | | | | | |
--------------------------------------------------------------------------------
| minority | | | | | | |
--------------------------------------------------------------------------------
| interest | | | | | -0.6 | -0.6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share | | | | | | | |
| holde | | | | | | | |
| rs' | | | | | | | |
--------------------------------------------------------------------------------
| equit | | | | | | | |
| y | | | | | | | |
--------------------------------------------------------------------------------
| 31.6. | 34.0 | 5.8 | -0.2 | 1.1 | 236.9 | 23.1 | 300.7 |
| 2008 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 5) CONSOLIDATED INCOME STATEMENT, QUARTERLY |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 10-1 | 1-3/ | 4-6/ | 7-9/ | 10-12/ | 1-3/ | 4-6/ |
| | 2/ | | | | | | |
--------------------------------------------------------------------------------
| EUR | 2006 | 2007 | 2007 | 2007 | 2007 | 2008 | 2008 |
| milli | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net | 490. | 328.0 | 551.9 | 655.7 | 638.5 | 444.9 | 645.9 |
| sales | 8 | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | | |
| opera | | | | | | | |
| ting | | | | | | | |
--------------------------------------------------------------------------------
| incom | 8.5 | 7.9 | 2.6 | 1.0 | 1.7 | 1.9 | 2.3 |
| e | | | | | | | |
--------------------------------------------------------------------------------
| Opera | | | | | | | |
| ting | | | | | | | |
--------------------------------------------------------------------------------
| expen | 458. | 330.8 | 500.5 | 586.8 | 608.7 | 447.2 | -601.7 |
| ses | 0 | | | | | | |
--------------------------------------------------------------------------------
| Depre | 8.0 | 4.9 | 9.0 | 12.3 | 8.1 | 4.9 | 9.3 |
| ciati | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
| Opera | | | | | | | |
| ting | | | | | | | |
--------------------------------------------------------------------------------
| profi | 33.4 | 0.3 | 45.0 | 57.6 | 23.4 | -5.3 | 37.1 |
| t/los | | | | | | | |
| s | | | | | | | |
--------------------------------------------------------------------------------
| Finan | | | | | | | |
| cial | | | | | | | |
--------------------------------------------------------------------------------
| expen | 5.7 | 4.1 | 5.1 | 6.3 | 6.7 | 7.8 | 9.8 |
| ses | | | | | | | |
--------------------------------------------------------------------------------
| Finan | | | | | | | |
| cial | | | | | | | |
--------------------------------------------------------------------------------
| incom | 2.1 | 1.0 | 1.9 | 0.6 | 2.7 | 1.7 | 3.3 |
| e | | | | | | | |
--------------------------------------------------------------------------------
| Share | | | | | | | |
| of | | | | | | | |
| the | | | | | | | |
--------------------------------------------------------------------------------
| resul | | | | | | | |
| ts of | | | | | | | |
--------------------------------------------------------------------------------
| affil | | | | | | | |
| iated | | | | | | | |
--------------------------------------------------------------------------------
| compa | 0.5 | -0.1 | 0.1 | 0.7 | 0.3 | -0.2 | 0.4 |
| nies | | | | | | | |
--------------------------------------------------------------------------------
| Profi | | | | | | | |
| t/los | | | | | | | |
| s | | | | | | | |
--------------------------------------------------------------------------------
| befor | 30.3 | -3.0 | 41.9 | 52.6 | 19.6 | -11.6 | 31.0 |
| e | | | | | | | |
| taxes | | | | | | | |
--------------------------------------------------------------------------------
| Incom | -6.1 | 1.1 | -10.2 | -12.3 | -9.2 | 2.2 | -7.6 |
| e | | | | | | | |
| taxes | | | | | | | |
--------------------------------------------------------------------------------
| Profi | | | | | | | |
| t/los | | | | | | | |
| s for | | | | | | | |
--------------------------------------------------------------------------------
| the | | | | | | | |
| accou | | | | | | | |
| nting | | | | | | | |
--------------------------------------------------------------------------------
| perio | 24.2 | -1.8 | 31.7 | 40.3 | 10.4 | -9.4 | 23.4 |
| d | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Distribution of the profit/loss for the | | | |
| accounting period | | | |
--------------------------------------------------------------------------------
| To | | | | | | | |
| paren | | | | | | | |
| t | | | | | | | |
--------------------------------------------------------------------------------
| compa | | | | | | | |
| ny | | | | | | | |
--------------------------------------------------------------------------------
| share | 22.1 | -3.7 | 30.2 | 38.7 | 7.8 | -10.0 | 22.1 |
| holde | | | | | | | |
| rs | | | | | | | |
--------------------------------------------------------------------------------
| To | | | | | | | |
| minor | | | | | | | |
| ity | | | | | | | |
--------------------------------------------------------------------------------
| inter | 2.1 | 1.9 | 1.5 | 1.6 | 2.6 | 0.6 | 1.4 |
| ests | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EPS calculated from profit attributable to parent company shareholders |
--------------------------------------------------------------------------------
| Earnings per share, diluted and undiluted |
--------------------------------------------------------------------------------
| EUR | 1.30 | -0.22 | 1.77 | 2.27 | 0.46 | -0.59 | 1.30 |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 6) NET SALES BY BUSINESS SECTOR |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | 06/200 | 06/2007 | Change | Change, | 12/2007 |
| | | 8 | | | | |
--------------------------------------------------------------------------------
| | | | | | % | |
--------------------------------------------------------------------------------
| Building | 571.9 | 442.3 | 129.6 | 29.3 | 1,042.9 |
| construction | | | | | |
--------------------------------------------------------------------------------
| Infrastructure | 346.0 | 301.4 | 44.6 | 14.8 | 820.3 |
| construction | | | | | |
--------------------------------------------------------------------------------
| Technical building | 124.4 | 103.4 | 21.0 | 20.3 | 230.2 |
| services | | | | | |
--------------------------------------------------------------------------------
| Building products | 70.8 | 58.1 | 12.7 | 21.9 | 133.8 |
--------------------------------------------------------------------------------
| Others | -22.3 | -25.3 | 3.0 | 11.9 | -53.0 |
--------------------------------------------------------------------------------
| Group, total | 1,090. | 879.9 | 210.9 | 24.0 | 2,174.1 |
| | 8 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 7) NET SALES BY BUSINESS SECTOR, QUARTERLY |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 10-1 | 1-3/ | 4-6/ | 7-9/ | 10-12/ | 1-3/ | 4-6/ |
| | 2/ | | | | | | |
--------------------------------------------------------------------------------
| EUR | 2006 | 2007 | 2007 | 2007 | 2007 | 2008 | 2008 |
| milli | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Build | | | | | | | |
| ing | | | | | | | |
--------------------------------------------------------------------------------
| const | 247. | 192.0 | 250.3 | 268.0 | 332.6 | 276.6 | 295.3 |
| ructi | 8 | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
| Infra | | | | | | | |
| struc | | | | | | | |
| ture | | | | | | | |
--------------------------------------------------------------------------------
| const | 173. | 81.4 | 220.0 | 301.7 | 217.2 | 95.5 | 250.5 |
| ructi | 3 | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
| Techn | | | | | | | |
| ical | | | | | | | |
--------------------------------------------------------------------------------
| build | | | | | | | |
| ing | | | | | | | |
--------------------------------------------------------------------------------
| servi | 56.3 | 46.2 | 57.2 | 58.5 | 68.3 | 56.5 | 68.0 |
| ces | | | | | | | |
--------------------------------------------------------------------------------
| Build | | | | | | | |
| ing | | | | | | | |
--------------------------------------------------------------------------------
| produ | 25.8 | 18.5 | 39.5 | 41.2 | 34.5 | 25.0 | 45.8 |
| cts | | | | | | | |
--------------------------------------------------------------------------------
| Other | -12. | -10.1 | -15.2 | -13.6 | -14.1 | -8.6 | -13.7 |
| s | 4 | | | | | | |
--------------------------------------------------------------------------------
| Group | 490. | 328.0 | 551.9 | 655.7 | 638.5 | 444.9 | 645.9 |
| , | 8 | | | | | | |
| total | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 8) OPERATING PROFIT/LOSS BY BUSINESS SECTOR |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | 06/200 | 06/2007 | Change | Change, | 12/2007 |
| | | 8 | | | | |
--------------------------------------------------------------------------------
| | | | | | % | |
--------------------------------------------------------------------------------
| Building | 21.4 | 31.8 | -10.4 | -32.7 | 71.5 |
| construction | | | | | |
--------------------------------------------------------------------------------
| Infrastructure | 4.0 | 8.0 | -4.0 | -50.0 | 38.6 |
| construction | | | | | |
--------------------------------------------------------------------------------
| Technical building | 8.1 | 4.6 | 3.5 | 76.1 | 11.9 |
| services | | | | | |
--------------------------------------------------------------------------------
| Building products | 3.4 | 3.4 | 0.0 | 0.0 | 11.1 |
--------------------------------------------------------------------------------
| Others | -5.1 | -2.6 | -2.5 | 96.2 | -6.7 |
--------------------------------------------------------------------------------
| Group, total | 31.8 | 45.3 | -13.5 | -29.8 | 126.3 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 9) OPERATING PROFIT/LOSS BY BUSINESS SECTOR, QUARTERLY |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 10-1 | 1-3/ | 4-6/ | 7-9/ | 10-12/ | 1-3/ | 4-6/ |
| | 2/ | | | | | | |
--------------------------------------------------------------------------------
| EUR | 2006 | 2007 | 2007 | 2007 | 2007 | 2008 | 2008 |
| milli | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Build | | | | | | | |
| ing | | | | | | | |
--------------------------------------------------------------------------------
| const | 20.5 | 14.6 | 17.2 | 14.3 | 25.5 | 10.1 | 11.3 |
| ructi | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
| Infra | | | | | | | |
| struc | | | | | | | |
| ture | | | | | | | |
--------------------------------------------------------------------------------
| const | 13.7 | -12.6 | 20.5 | 36.0 | -5.5 | -14.7 | 18.8 |
| ructi | | | | | | | |
| on | | | | | | | |
--------------------------------------------------------------------------------
| Techn | | | | | | | |
| ical | | | | | | | |
--------------------------------------------------------------------------------
| build | | | | | | | |
| ing | | | | | | | |
--------------------------------------------------------------------------------
| servi | 1.1 | 1.3 | 3.3 | 3.5 | 3.8 | 2.2 | 5.9 |
| ces | | | | | | | |
--------------------------------------------------------------------------------
| Build | | | | | | | |
| ing | | | | | | | |
--------------------------------------------------------------------------------
| produ | 0.3 | -1.3 | 4.7 | 5.6 | 2.0 | -1.5 | 4.9 |
| cts | | | | | | | |
--------------------------------------------------------------------------------
| Other | -2.2 | -1.8 | -0.8 | -1.7 | -2.4 | -1.3 | -3.7 |
| s | | | | | | | |
--------------------------------------------------------------------------------
| Group | 33.4 | 0.3 | 45.0 | 57.6 | 23.4 | -5.3 | 37.1 |
| , | | | | | | | |
| total | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 10) ECONOMIC TRENDS AND FINANCIAL INDICATORS |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 06/2008 | 06/2007 | | 12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on equity, % | 4.5 | 11.2 | | 27.5 |
--------------------------------------------------------------------------------
| Return on investment, % | 4.7 | 7.3 | | 20.7 |
--------------------------------------------------------------------------------
| Operating profit/loss, % of | 2.9 | 5.1 | | 5.8 |
| net sales | | | | |
--------------------------------------------------------------------------------
| Equity ratio, % | 23.9 | 26.6 | | 32.7 |
--------------------------------------------------------------------------------
| Gearing, % | 171.5 | 146.0 | | 87.2 |
--------------------------------------------------------------------------------
| Interest-bearing net debt, | 515.6 | 391.2 | | 278.5 |
| EUR million | | | | |
--------------------------------------------------------------------------------
| Gross investments, EUR | | | | |
| million | | | | |
--------------------------------------------------------------------------------
| (incl. leasing purchases) | 35.6 | 37.4 | | 61.4 |
--------------------------------------------------------------------------------
| Order book, EUR mill. | 1,696.7 | 1,622.0 | | 1,414.1 |
--------------------------------------------------------------------------------
| - of which foreign orders, | 456.4 | 449.3 | | 284.0 |
| EUR mill. | | | | |
--------------------------------------------------------------------------------
| Average number of employees | 9,498 | 8,762 | | 9,201 |
--------------------------------------------------------------------------------
| Employees at end of period | 10,919 | 10,397 | | 8,718 |
--------------------------------------------------------------------------------
| Net sales, EUR mill. | 1,090.8 | 879.9 | | 2,174.1 |
--------------------------------------------------------------------------------
| - of which operations abroad, | 282.4 | 212.6 | | 581.6 |
| EUR mill. | | | | |
--------------------------------------------------------------------------------
| % of net sales | 25.9 | 24.2 | | 26.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 11) SHARE-SPECIFIC INDICATORS | 06/2008 | 06/2007 | | 12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share, EUR | 0.71 | 1.55 | | 4.29 |
--------------------------------------------------------------------------------
| Equity per share, EUR | 16.31 | 14.67 | | 17.36 |
--------------------------------------------------------------------------------
| Dividend per share, EUR | | | | 1.80 |
--------------------------------------------------------------------------------
| Dividend to earnings ratio, % | | | | 42.0 |
--------------------------------------------------------------------------------
| Market capitalisation, EUR | 493.8 | 892.8 | | 536.2 |
| mill. | | | | |
--------------------------------------------------------------------------------
| Share price at end of period, | 29.01 | 52.45 | | 31.50 |
| EUR | | | | |
--------------------------------------------------------------------------------
| Trading volume during period, | 2,158 | 3,139 | | 5,204 |
| 1 000 shares | | | | |
--------------------------------------------------------------------------------
| Number of issued shares, 1 | 17,021 | 17,021 | | 17,021 |
| 000 shares | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 12) TANGIBLE ASSETS | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | | 06/ | 06/2007 | | 12/200 | |
| | | | 200 | | | 7 | |
| | | | 8 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Acquisition cost at beginning of | 411 | 402.0 | | 402.0 | |
| period | .5 | | | | |
--------------------------------------------------------------------------------
| Translation difference | 0.3 | 0.8 | | 0.6 | |
--------------------------------------------------------------------------------
| Increases | 32. | 26.0 | | 47.6 | |
| | 0 | | | | |
--------------------------------------------------------------------------------
| Increases from business | | | | | |
--------------------------------------------------------------------------------
| combinations | 1.6 | 3.4 | | 3.7 | |
--------------------------------------------------------------------------------
| Decreases | -10 | -24.6 | | -42.4 | |
| | .3 | | | | |
--------------------------------------------------------------------------------
| Accumulated depreciation | -24 | -229.1 | | -235.5 | |
| | 4.2 | | | | |
--------------------------------------------------------------------------------
| Carrying amount at end of period | 191 | 178.5 | | 176.1 | |
| | .0 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 13) DIVESTED BUSINESSES | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The Group does not have any non-current assets classified on the basis | |
| of | |
--------------------------------------------------------------------------------
| IFRS 5 as available for sale at the end of the accounting period. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The Group did not divest any businesses during the review period. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 14) ACQUIRED BUSINESSES | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Description of acquired enterprises, businesses and ownership interests | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| A construction business was acquired from Kokkolan NSA-Rakennus Oy | |
--------------------------------------------------------------------------------
| on 1 March 2008. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Full ownership of Tolarock Oy was acquired on 5 June 2008. The | |
--------------------------------------------------------------------------------
| Company's business is rock engineering. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Aggregated information on acquired businesses | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | Carrying amounts | Fair values | |
--------------------------------------------------------------------------------
| | before merging | after merging | |
--------------------------------------------------------------------------------
| | | 30.6.2008 | 30.6.2008 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Tangible and intangible | | | | | | |
--------------------------------------------------------------------------------
| assets | | 1.0 | | | 1.9 | |
--------------------------------------------------------------------------------
| Inventories | | 1.2 | | | 1.5 | |
--------------------------------------------------------------------------------
| Current receivables | | 0.7 | | | 0.7 | |
--------------------------------------------------------------------------------
| Cash and cash | | 0.8 | | | 0.8 | |
| equivalents | | | | | | |
--------------------------------------------------------------------------------
| Assets, total | | 3.7 | | | 4.9 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Deferred tax | | 0.0 | | | 0.3 | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Interest-bearing | | 0.2 | | | 0.2 | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Other liabilities | | 0.4 | | | 0.4 | |
--------------------------------------------------------------------------------
| Liabilities, total | | 0.6 | | | 1.0 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net assets | | 3.0 | | | 4.0 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Acquisition cost, total | | 5.0 | | | 5.0 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Goodwill, total | | | | | 1.1 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Transaction price paid in cash | | | | 5.0 | |
--------------------------------------------------------------------------------
| Cash funds of acquired | | | | -0.8 | |
| subsidiary | | | | | |
--------------------------------------------------------------------------------
| Cash flow effect | | | | 4.2 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The acquired businesses have no effect on the Group's operating result | |
| for | |
--------------------------------------------------------------------------------
| the accounting period. The net sales of the acquired businesses in 2007 | |
--------------------------------------------------------------------------------
| were approx. EUR 16.0 million. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The figures are provisional. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 15) RELATED-PARTY TRANSACTIONS | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | 06/ | 06/2007 | | 12/200 | |
| | 200 | | | 7 | |
| | 8 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Sales of goods and services | | | | | |
--------------------------------------------------------------------------------
| To affiliated companies | 0.0 | 0.0 | | 0.1 | |
--------------------------------------------------------------------------------
| To senior management | 0.0 | 0.2 | | 0.3 | |
--------------------------------------------------------------------------------
| Total | 0.0 | 0.2 | | 0.4 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Purchases of goods and services | | | | | |
--------------------------------------------------------------------------------
| From affiliated companies | 3.0 | 1.4 | | 5.7 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Trade receivables | | | | | |
--------------------------------------------------------------------------------
| From affiliated companies | 0.1 | 0.0 | | 0.0 | |
--------------------------------------------------------------------------------
| From senior management | 0.0 | 0.1 | | 0.0 | |
--------------------------------------------------------------------------------
| Total | 0.1 | 0.1 | | 0.1 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Accounts payable | | | | | |
--------------------------------------------------------------------------------
| To affiliated companies | 0.3 | 0.0 | | 0.0 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 16) GUARANTEES AND CONTINGENT LIABILITIES |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | 06/2008 | 06/2007 | | 12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Securities for own | | | | |
| commitments | | | | |
--------------------------------------------------------------------------------
| Property mortgages | 1.5 | 1.6 | | 3.1 |
--------------------------------------------------------------------------------
| Business mortgages | 94.8 | 99.5 | | 95.3 |
--------------------------------------------------------------------------------
| Bonds pledged as security | 0.6 | 0.8 | | 0.8 |
--------------------------------------------------------------------------------
| Total | 96.9 | 101.9 | | 99.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Guarantees | | | | |
--------------------------------------------------------------------------------
| On behalf of affiliated | 0.1 | 0.8 | | |
| companies | | | | |
--------------------------------------------------------------------------------
| On behalf of others | 8.4 | 3.8 | | 9.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Minimum lease payments of irrevocable lease agreements |
--------------------------------------------------------------------------------
| One year or less | 7.1 | 5.8 | | 5.7 |
--------------------------------------------------------------------------------
| One to five years | 29.4 | 18.9 | | 20.8 |
--------------------------------------------------------------------------------
| Over five years | 22.1 | 20.7 | | 20.2 |
--------------------------------------------------------------------------------
| Total | 58.6 | 45.4 | | 46.7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Purchase commitments of | 7.3 | 3.8 | | 11.3 |
| investments | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Derivative contracts | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Forward foreign exchange | | | | |
| contracts | | | | |
--------------------------------------------------------------------------------
| Nominal value | 55.4 | 39.7 | | 54.6 |
--------------------------------------------------------------------------------
| Fair value | 0.1 | -0.1 | | -0.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest rate options, calls | | | | |
| purchased | | | | |
--------------------------------------------------------------------------------
| Nominal value | 2.6 | 33.8 | | 3.5 |
--------------------------------------------------------------------------------
| Fair value | 0.0 | 0.0 | | 0.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest rate options, puts | | | | |
| written | | | | |
--------------------------------------------------------------------------------
| Nominal value | 2.6 | 4.3 | | 3.5 |
--------------------------------------------------------------------------------
| Fair value | 0.0 | 0.0 | | 0.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest rate swap contracts | | | | |
--------------------------------------------------------------------------------
| Nominal value | 77.7 | 110.1 | | 95.6 |
--------------------------------------------------------------------------------
| Fair value | 1.4 | -0.3 | | -0.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The fair value of contracts is the gain or loss arising from | |
| closure | |
--------------------------------------------------------------------------------
| of the contract based on the market price on the accounting date. | |
--------------------------------------------------------------------------------
17) LEGAL PROCEEDINGS
Legal proceedings arising from IKEA's termination of construction contract for
the MEGA shopping centre in St. Petersburg are now underway in the court of
arbitration in Stockholm.
The Market Court imposed an infringement fine of EUR 14 million on Lemminkäinen
for activities contravening competition law in road paving operations in
Finland. The infringement fine was recognised as an expense in the fourth
quarter of 2007. The decision has been appealed to the Supreme Administrative
Court, so the total amount of the fine may change.
Lemminkäinen has been informed of an application for a summons in which the
Finnish Road Administration is demanding compensatory damages from different
asphalt companies before the Helsinki District Court. Lemminkäinen's share of
the claimed compensation is at most EUR 10.5 million. The Finnish Road
Administration is also seeking damages of at most EUR 5.6 million from
Lemminkäinen, under joint and several liability with other defendant companies.