Börsiteade
Luterma
Kategooria
Juhtkonna vaheteadaanne või kvartaalne finantsaruanne
Manused
Kuupäev
27.02.2008 12:00:26
Pealkiri
Unaudited 6-month 2007/2008 interim financial statements
Teade
COMMENTS ON ECONOMIC ACTIVITIES 1.1. General information and changes in organisational structure AS Kalev pursues several fields of activity, including manufacturing and sale of foodstuffs, real-estate-related activities, as well as media, publishing and printing activities. The company has long-term experience in the chocolate, sugar and flour confectionery product segment as well as the dairy product segment. AS Kalev has also pursued real estate development and management projects for a longer period of time. Last financial year, AS Kalev expanded its activities into media, publishing and printing, and developed these segments aggressively in the reporting period. Foodstuff production is carried out in five production plants located in Põrguvälja (in Rae Municipality), Paide, Viljandi, Jõhvi and Kiviõli. The products are, among other channels, sold through the company's pan-Estonian retail chain, consisting of 15 candy stores and cafeterias. Kalev Group's parent company is AS Kalev. In addition, the group incorporates twenty subsidiaries. AS Uniprint is considered a subsidiary since, under the shareholders' agreement, the Group has the obligation to purchase the company's shares at the latest in April 2009. A significant change was introduced in the group structure in the first quarter of the financial year 2007/2008. Namely, AS Kalev acquired a share with a nominal value of 40,000 kroons in the private limited company Soltari Invest under the contract concluded on 17 August 2007. The above acquisition does not constitute related party transactions in the meaning of the stock exchange rules. With the transaction, AS Kalev became the sole shareholder of the private limited company which was renamed into AgriStock OÜ. The subsidiary's strategic activities include production, development of the processing, storage and reloading of grain products. In connection with the disposal of the food production companies and abandonment of the particular field of activity (see Note 12), AgriStock OÜ transferred the set of assets related to the particular field of activity in the second quarter of the financial year. At the end of 2007, AS Kalev Chocolate Factory launched the transition to product group-based production, starting to manufacture pastry products and flour confectionery products in different production plants. The specialisation served the goal of enhancing logistical and production efficiency in order to ease the strong pressure for cost price increase, and bring the know-how under a single production unit. The first stage of this process will involve changes in biscuit production in the Kiviõli production plant of AS Kalev Jõhvi Tootmine. In the second stage, pastry production will be fully transferred to the Jõhvi plant, partly by exploiting the labour resources made available with the first stage. At the same time, the group's flour confectionery production will be transferred to the AS Vilma production plant in Viljandi. On 20 September 2007, AS Kalev signed a contract for purchase and sale of the shares with ALTA CAPITAL PARTNERS S.C.A SICAR on the transfer of 3,857,824 shares (100% of the share capital) of AS Kalev Paide Tootmine, 13,835,334 shares (100% of the share capital) of AS Kalev Chocolate Factory, 991 shares (99.1% of the share capital) of AS Kalev Jõhvi Tootmine, 720,000 shares (100% of the share capital) of AS Vilma and a share (81.26% of the share capital) of OÜ Maiasmokk. The transferred AS Kalev Paide Tootmine also holds a stake in AS Valmetek Invest. AS Kalev will continue its activities under the same business name. Any trademarks in the food industry will be transferred to the buyer within the framework of the transaction. The right to the trademark KALEV will be kept by AS Kalev. With the transaction, AS Kalev will give up two of its main areas of activity - confectionery industry and dairy industry. In the future, AS Kalev will focus on the development of its remaining main activities - real estate development and investment property, media industry and printing industry, and on searching for new investment options. The transaction is not a transaction with related party in the meaning of the requirements established for issuers by the Tallinn Stock Exchange. The Supervisory Board and Management Board of AS Kalev have no other interests regarding the transaction. AS Kalev has a significant interest in the following companies: -------------------------------------------------------------------------------- | Name of | Location | As of 31.12.2007 | As of 31.12.2006 | | subsidiary | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | AS Kalev Paide | Estonia | 100% | 100% | | Tootmine* | | | | -------------------------------------------------------------------------------- | AS Valmetek | Estonia | 65.6% | 65.6% | | Invest* | | | | -------------------------------------------------------------------------------- | AS Kalev Jõhvi | Estonia | 99.1% | 99.1% | | Tootmine* | | | | -------------------------------------------------------------------------------- | AS Vilma* | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | AS Kalev Real | Estonia | 100% | 100% | | Estate Company | | | | | (AS Kalev REC) | | | | -------------------------------------------------------------------------------- | EOOD Stude REC | Bulgaria | 100% | 100% | -------------------------------------------------------------------------------- | OÜ BCA Center | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | OÜ BCA | Estonia | 100% | 100% | | Kinnisvara | | | | -------------------------------------------------------------------------------- | OÜ Maiasmokk* | Estonia | 86.4% | 81.3% | -------------------------------------------------------------------------------- | AS Kalev | Estonia | 100% | 100% | | Chocolate | | | | | Factory* | | | | -------------------------------------------------------------------------------- | AS Kalev | USA | 100% | 100% | | Merchant | | | | | Services Ltd | | | | -------------------------------------------------------------------------------- | OÜ Sugarstar | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | AS Inreko Press | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | OÜ Olliwood | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | AS Eksklusiiv | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | AS Kalev Meedia | Estonia | 100% | 100% | -------------------------------------------------------------------------------- | OÜ Eesti | Estonia | 100% | 100% | | Spordikanal | | | | -------------------------------------------------------------------------------- | AS Uniprint | Estonia | 40% | 40% | -------------------------------------------------------------------------------- | AS Unipress | Estonia | 40% | 40% | -------------------------------------------------------------------------------- | OÜ AgriStock | Estonia | 100% | 0% | -------------------------------------------------------------------------------- * Discontinued operations 1.2. Financial results Important factors contributing to the results of AS Kalev Group for the first 6 months of the financial year 2007/2008: 1) nearly a 35% increase in net turnover of goods and services, compared to the comparative period; 2) a 22% increase in consolidated gross profit, compared to the comparative period (with the gross profit from discontinued operations increasing by 60% while continued operations still posted a gross loss); 3) increase in the share of export in total turnover - export made up nearly 40% of the total sales of goods; the share of goods and services sold in Estonia has decreased by five percentage points compared to the same period last year, amounting to 60% of the total turnover; 4) as regards the continued operations, the revenue from media and event marketing has showed significant growth, although these segments still post a loss. Conditioned largely by macroeconomic factors, the high profitability of the group's real estate segment in the last period has shown significant decrease; 5) as regards discontinued operations, the biggest growth can be seen in the sale of dairy products (34%, compared to the same period last year), with the previous negative result turned to positive. The sale of confectionery products has increased by nearly 10% during the year, although the segment's profitability has significantly decreased. The consolidated net sales of AS Kalev for the first 6 months of the financial year 2007/2008 amounted to 617.7 million kroons (39.5 million euros), showing a 35% growth compared to the same period last financial year. The continued operations of AS Kalev showed a much quicker development than that of the group, with revenue increasing by more than 2.1 times. In comparison, the annual growth in discontinued operations was 25%. The biggest contributors to the total group turnover, compared to last period, included a significant decrease in the real estate segment and an increase in the sale of confectionery and dairy products as well as the new areas pursued ― printing and media. In the first 6 months of the financial year 2007/2008, AS Kalev posted a consolidated net loss of 22.2 million kroons (1.4 million euros); in the comparative period, the company posted a net profit of 10.5 million kroons (0.67 million euros). In the first 6 months of the financial year 2007/2008, AS Kalev Group had an average of 893 employees (incl. 721 employees in the discontinued operations); in the comparative period last financial year, the group had an average of 789 employees (incl. 760 employees in the discontinued operations). The net sales and net profit of AS Kalev Group companies for the first 6 months of the financial year 2007/2008 have been brought out in the below tables (in thousands of kroons and euros), separately for each company. Comparative data has been brought out on 14 companies. The financial indicators of the subsidiary Kalev Merchant Services Ltd have not been consolidated, since the balance sheet volume of the subsidiary only makes up less than 0.5% of the parent company's turnover. Data on associated companies has not been included in the tables. The data on AS Kalev Paide Tootmine, AS Kalev Real Estate Company, AS Kalev Meedia and AS Uniprint also include the corresponding financial results of their subsidiaries. -------------------------------------------------------------------------------- | | Net sales | | Net profit | | -------------------------------------------------------------------------------- | EEK | 2007/2008 | 2006/2007 | 2007/2008 | 2006/2007 | -------------------------------------------------------------------------------- | | 6 months | 6 months | 6 months | 6 months | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | AS Kalev** | 319 | 144 392 | -35 803 | -21 951 | -------------------------------------------------------------------------------- | AS Kalev | 294 933 | 221 351 | 22 441 | 21 291 | | Chocolate | | | | | | Factory | | | | | -------------------------------------------------------------------------------- | AS Kalev | 226 857 | 164 934 | 35 279 | -400 | | Paide | | | | | | Tootmine* | | | | | -------------------------------------------------------------------------------- | AS Kalev | 18 520 | 286 377 | -11 357 | 11 279 | | REC* | | | | | -------------------------------------------------------------------------------- | AS Kalev | 22 659 | 18 285 | -1 442 | -2 450 | | Jõhvi | | | | | | Tootmine | | | | | -------------------------------------------------------------------------------- | OÜ Maiasmokk | 4 125 | 4 156 | 246 | 178 | -------------------------------------------------------------------------------- | AS Vilma | 16 916 | 13 107 | 63 | 252 | -------------------------------------------------------------------------------- | OÜ Sugarstar | 4 302 | 1 667 | -498 | -372 | -------------------------------------------------------------------------------- | AS Inreko | 0 | 869 | -234 | 373 | | Press*** | | | | | -------------------------------------------------------------------------------- | OÜ | 0 | 0 | -174 | 0 | | Olliwood*** | | | | | -------------------------------------------------------------------------------- | OÜ | 1 868 | 0 | -499 | | | Eksklusiiv | | | | | -------------------------------------------------------------------------------- | AS Kalev | 8 260 | 0 | -20 797 | 0 | | Meedia* | | | | | -------------------------------------------------------------------------------- | AS Uniprint* | 58 581 | 0 | 313 | 0 | -------------------------------------------------------------------------------- | OÜ Agristock | 25 062 | 0 | -9 771 | 0 | -------------------------------------------------------------------------------- * consolidated ** calculated change in turnover, as a result of which production activities previously attributed to AS Kalev have been attributed to AS Kalev Chocolate Factory since 01.07.2006, and sale of goods since 01.09.2006. *** the activities of subsidiaries involved in the media segment have been attributed to AS Kalev Meedia since 01.06.2007. -------------------------------------------------------------------------------- | | Net sales | |Net profit | | -------------------------------------------------------------------------------- | EUR | 2006/2007 | 2005/2006 | 2006/2007 | 2005/2006 | -------------------------------------------------------------------------------- | | 6 months | 6 months | 6 months | 6 months | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | AS Kalev** | 20 | 9 228 | -2 288 | -1 403 | -------------------------------------------------------------------------------- | AS Kalev | 18 850 | 0 | 1 434 | 0 | | Chocolate | | | | | | Factory | | | | | -------------------------------------------------------------------------------- | AS Kalev | 14 499 | 10 541 | 2 255 | -26 | | Paide | | | | | | Tootmine* | | | | | -------------------------------------------------------------------------------- | AS Kalev | 1 184 | 18 303 | -726 | 721 | | REC* | | | | | -------------------------------------------------------------------------------- | AS Kalev | 1 448 | 1 169 | -92 | -157 | | Jõhvi | | | | | | Tootmine | | | | | -------------------------------------------------------------------------------- | OÜ Maiasmokk | 264 | 266 | 16 | 11 | -------------------------------------------------------------------------------- | AS Vilma | 1 081 | 838 | 4 | 16 | -------------------------------------------------------------------------------- | OÜ Sugarstar | 275 | 107 | -32 | -24 | -------------------------------------------------------------------------------- | AS Inreko | 0 | 56 | -15 | 24 | | Press*** | | | | | -------------------------------------------------------------------------------- | OÜ | 119 | 0 | -11 | 0 | | Olliwood*** | | | | | -------------------------------------------------------------------------------- | OÜ | 528 | 0 | -32 | 0 | | Eksklusiiv | | | | | -------------------------------------------------------------------------------- | AS Kalev | 528 | 0 | -1 329 | 0 | | Meedia* | | | | | -------------------------------------------------------------------------------- | AS Uniprint* | 3 744 | 0 | 20 | 0 | -------------------------------------------------------------------------------- | OÜ Agristock | 0 | 0 | -624 | 0 | -------------------------------------------------------------------------------- * consolidated ** calculated change in turnover, as a result of which production activities previously attributed to AS Kalev have been attributed to AS Kalev Chocolate Factory since 01.07.2006, and sale of goods since 01.09.2006. *** the activities of subsidiaries involved in the media segment have been attributed to AS Kalev Meedia since 01.06.2007. In the first 6 months of the financial year, AS Kalev increased financial gearing in the financing of the group's further development, incl. conducting a bonus issue. The Group's current liabilities showed a bigger increase than that in turnover, conditioning a drop in the liquidity ratio (see table below). In turn, the growth in financial gearing has increased financial expenses. As regards other expense items, the biggest growth (28% compared to last period) can be seen in the group's marketing expenses. The record-breaking growth in these expenses was foreseen as a natural part of business expansion into a new field of activity. At the same time, the growth in the Group's administrative and general expenses (17.5%) has been rather modest in the first half of the financial year, compared to other expense items, regardless of the quick growth in personnel expenses, the inflationary economic environment and incurrence of additional information and consulting expenses in connection with business expansion into a new field of activity (media). The most important financial ratios of AS Kalev Group have been brought out in the below table: -------------------------------------------------------------------------------- | AS Kalev Group | | | -------------------------------------------------------------------------------- | | 01.07.2007- | 1.07.2006 | -------------------------------------------------------------------------------- | | 31.12.2007 | 31.12.2006 | -------------------------------------------------------------------------------- | Current ratio | 0.65 | 0.73 | -------------------------------------------------------------------------------- | Financial gearing | 0.81 | 0.66 | -------------------------------------------------------------------------------- | Asset turnover ratio | 0.44 | 0.70 | -------------------------------------------------------------------------------- | Net profit margin (%) | -3.6% | 5.6% | -------------------------------------------------------------------------------- | Return on assets, ROA | -1.6% | 3.7% | | (%) | | | -------------------------------------------------------------------------------- * The financial ratios have been calculated based on the following methods: Current ratio = current assets / current liabilities Financial gearing = total liabilities / average total assets Asset turnover ratio = revenue / average total assets Net profit margin = net profit / revenue * 100% Return on assets (ROA) = net profit / average total assets * 100% 1.3. Product market and sales In the first 6 months of the financial year 2007/2008 AS Kalev sold a total of 14,870 tons of confectionery and dairy products. Total sales increased by 27.2% compared to the same period last financial year. 89% of the total sales of confectionery market were sold in Estonia, and 11% exported. Dairy products showed the opposite trend, with - 90% of the goods exported and 10% sold at the home market. 1.3.1. Confectionery products According to the retail trade survey conducted by AC Nielsen (4th quarter of 2007), AS Kalev Group's chocolate and sugar confectionery market share was 37% as regards turnover, and 43% as regards sales volume, having increased by 0.6 and 1.3 percentage points during the year, respectively. Kalev's share of the Estonian biscuit market has increased to 11.3% as regards turnover. This ranks Kalev the second biggest producer in the segment with respect to the market volume. In the second quarter of 2007/2008, the company's marketing and sales activities focused on the launch of a Christmas collection which consisted of 40 different items, all with a thematic design. As has become tradition, the Christmas portfolio consisted of product series designed for both adults and children, combining a selection of candies, boxed chocolate, chocolate tablets and gingerbread cookies. In addition to the Christmas portfolio, the company launched nine other products in the period. In the chocolate and sugar confectionery product segment, the company added 300g and 100g milk chocolates to the Kalev Special chocolate series launched in the previous quarter. In the gift box product group, Kalev launched new Kannel (350g) boxed chocolate candies, and renewed the design and package of Šokolaadinööbid (125 g). Pastry and flour products saw four new additions in the Linda strudel series - the ham-lecho strudel (400g), cream cheese bun (600g), cranberry bun (600g) and toffee bun (600g). A 300g plum cake was added to the Linda shortcake selection. As regards volume, the total sale of AS Kalev's sugar and chocolate confectionery products amounted to 3,570 tons in the period. This constitutes a 7% increase in the sale of sugar and chocolate confectionery products, compared to the same period last financial year. At the same time, the dynamics of the sale of confectionery products was different for different product groups: a quicker-than-average growth could be seen in the sales of chocolate tablets (31%) and boxed chocolate candies (13%); the sale of candies increased by 7%, compared to the first 6 months of the last financial year. Chocolate tablets showed the biggest sales growth, with a 25% sales increase, compared to the same period last financial year. Boxed chocolate candy sales increased by 10% whereas candy sales decreased by 3%. Through its 15 retail stores, AS Kalev sold a total of 10.3 million kroons worth of goods (incl. sugar, chocolate and flour confectionery products and pastry products). Total Christmas sales amounted to 550 tons, with candies contributing 45%, chocolate tablets 29%, gingerbread cookies 18% and boxed chocolate candy 8%. The total volume of the Group's flour confectionery products (incl. pastry products, biscuits and flour mixes) amounted to 1,690 tons in the first 6 months of the financial year 2007/2008. The sale of flour confectionery products decreased by nearly 20% compared to the same period last financial year. Similarly to sugar and chocolate confectionery segments, different sales dynamics can be distinguished among the product groups of the flour confectionery segment: for instance, sales of flour mixes increased by 40% compared to the first 6 months of the last financial year (growth in volume: 22%) and sale of biscuits by 30% (growth in volume: 20%), whereas sale of pastry products decreased by 17%. As regards turnover, a majority (89%) of the total sales of confectionery products (i.e. sugar, chocolate and flour confectionery products) was sold at the home market in the first 6 months of the financial year 2007/2008. At the same time, product sales in different foreign markets have increased compared to last year, making up 11% of the total turnover. Confectionery product export showed an especially quick, 29% increase compared to the first 6 months of the last financial year, with Latvia contributing 28%, Lithuania 26%, the so-called Travel Trade segment nearly 25%, Russia 12% and other countries 9%. 1.3.2. Dairy products Different dairy products were produced from the crude milk stocked by AS Kalev Paide Tootmine in the first half of the financial year. Due to the market conditions and economic justification, the main focus of the period lay in the production of condensed skimmed milk and cream, which made up three-quarters of the total output. Skimmed milk powder sales made up nearly 10% of the total volume. To a lesser extent, skimmed milk powder was used for producing high-temperature pasteurized milk. The company also produced a smaller volume of whole milk powder and other dairy products. As regards volume, production grew by 65%, compared to the same period last year. Nearly 90% (80% in the comparative period) of the total output of AS Kalev Paide Tootmine was exported to the European Union (mainly Germany). A little more than 10% was sold at the home market. Compared to the same period last year, the total sales of dairy products have increased by nearly 56%, amounting to 9,610 tons. The increase in the price of stocked milk has had a significant influence on the results for the first six months of the financial year, as well as on the whole dairy market. According to the Statistical Office, the price of crude milk increased by approximately 20% compared to the comparative period. Although the raw material prices in Estonia have increased by 20%, the price of dairy products at the global market has dropped, compared to the price level of August/September. For instance, in Germany, the price of milk powder had dropped, by the end of 2007, to the level of the beginning of the year. AS Kalev Paide Tootmine added fatty powders, skimmed milk and milk concentrate to its list of products in the reporting period. The main focus of product development in AS Kalev Paide Tootmine lies in the creation of additional options for valuation of the raw material. The company has consequently made investments, the amount of which exceeds the respective indicator for the last period. The cream production line has been improved with automatic sample-takers in order to get a good sample of the raw material. The company has also implemented methods of analysis for more accurate measurement of the fat content. For valuation of fat as a powder product, the cream powder production technology was improved: the company added a homogenisator to the production line, and renewed the powder transportation system to bring it into line with the requirements for transporting more glutinous powder. In 2007, four new concentrate products were launched, including milk and skimmed milk concentrates with different dry matter and fat content. The most important development project was development of the option of valuation of skimmed milk and milk as an alternative for the drying technology in the production of concentrates, as well as the creation of the loading option for the concentrate. Under favourable price conditions, these efforts will allow to cut energy expenses on drying and increase production volumes. 1.3.3. Real estate activities AS Kalev pursues real estate management and development activities through its subsidiary AS Kalev Real Estate Company (hereinafter Kalev REC), and through its subsidiaries and associated companies. The most important current project in the real estate segment is that pursued by OÜ BCA Center. The development project has to do with the reconstruction of five schools in Tallinn within the framework of the Private Partnership for Tallinn Schools Project. The earlier real estate projects of AS Kalev REC have been further developed - the company has sold all apartments in the 19-apartment building in Marat Street in Tallinn, as well as the 25-apartment building in Hommiku Street in Pärnu. AS Kalev REC's Bulgarian-based subsidiary EOOD Stude REC continues the construction of the 6,500m2 apartment building in Sofia. The building is scheduled to be completed in the summer of 2008. The permit of use is scheduled to be issued by the end of 2008. 1.3.4. Media AS Kalev Meedia publishes the gossip magazine Just, financial magazine Ärielu, sports magazines Sporditäht, Basket and Jalka; fashion and lifestyle magazines Avenüü and Avenüü Professional as well as the children's magazine Muumi. According to the Estonian Media Survey by TNS Emor in the 4th quarter of 2007, Just had 47,000, Sporditäht 18,000, Avenüü 23,000, Muumi 15,000, Ärielu 11,000 and Basket 5,000 readers. The sports magazine Sporditäht was renewed in the reporting period. With a new concept and a new editor, the magazine is published, from September, as a weekly. To launch the new product, the company organised an extensive advertising campaign. This was also the first bigger public campaign for AS Kalev Meedia. The company has also completed several bigger projects. In October, a new concept was developed for the financial magazine Ärielu. A new web-based news portal www.kalev.ee was completed. Major changes were introduced to the contents and format of the gossip magazine Just at the end of 2007. The preparation for the launch of the new television channel by AS Kalev Meedia's subsidiary OÜ Eesti Spordikanal was also completed. The new sports-orientated news and entertainment channel KalevSport was launched by AS Kalev Meedia's subsidiary OÜ Eesti Spordikanal on November 12. According to the TV Audience Meter Survey conducted by TNS EMOR between November 12 -December 31 (target group: Estonian population over the age of 4), the Daily Reach of Kalev Sport was 35,000, the Daily Reach % was 2.7 and the Daily Share was 0.3%. To create a synergy between the different pursuits - print media, Internet, telemedia, and ensure the consequent increase in content quality, cost efficiency and competitiveness, the different editorials were brought to AS Kalev Meedia's new premises at Tornimäe 5, Tallinn. 1.3.5. Printing In the printing segment, the most important change in the reporting period was that in the distribution of market risks. With the aim of reducing customer credit risk in Russia and enhance profitability of the customer portfolio, AS Uniprint's subsidiary AS Unipress reduced the number of customers in Russia, as well as the volume of goods delivered on hire-purchase terms. This change had been planned in advance and will not condition a decrease in the business volumes of AS Unipress. As a result of the reorganisation, deliveries to Russia have been replaced with sales to other customers. Medium-size investments have been made in the printing industry in order to enhance production efficiency and offer full services to customers by simultaneously reducing the share of outsourced services. AS Unipress has successfully implemented the automatic packaging device Stacker CS70, which allows more efficient use of labour (the investment amounted to approximately 4 million kroons). AS Uniprint invested 3.4 million kroons in the new UV-gloss machine Steinmann Colibri Junior. The machine was put into operation in February, and allows Uniprint and Unipress to save time on the preparation of UV-gloss after-treated publications. With the new machine, the entire publication production process and quality is fully controlled by the company. 1.4. Future activities As regards the continued operations of AS Kalev, the company still pursues real estate activities AS Kalev REC and its direct subsidiaries. The quick growth in the real estate sector in Estonia has allowed AS Kalev Group to actively pursue real estate development and management. So far, the main attention has focused around residential and commercial space development. In the future, the company plans to develop its activities also in the public real estate sector, including partnership projects. AS Kalev is set to change its strategy in accordance with the dynamics of the sector, and the occurrences on the real estate market. Major changes are revolving around AS Kalev's new fields of activity ― media and printing services. The company is planning to further develop the group's magazines, enhance reader numbers and increase advertising revenue. The company will also develop the web-based news portal www.kalev.ee and the television channel KalevSport. A photo studio is being set up in order to enhance the speed and quality of photo material production in the Group. In addition, the company is weighing the option of expanding into the media market. In the printing segment, the company aims to take better advantages of the options provided by print houses specialised in quality publications in its advertising pursuits and production of various publications. As regards the discontinued operations of AS Kalev, AS Kalev Chocolate Factory bases its pursuits on the goal of being the market leader in the sugar and chocolate confectionery segment. Profitability will be increased through optimising the assortment and enhancing production efficiency. In product development, the goal is to extend the terms of expiry as well as produce healthy products and create new flavours. The chocolate confectionery segment focuses on the development of chocolate tablets, chocolate candies and boxed chocolates, while the sugar confectionery segment focuses on chewing candies and toffee. The share of pastry products will increase in the flour confectionery segment, with continual focus to be paid to the biscuit and flour mix segment. The dairy segment too is a part of the operations which are to be discontinued by AS Kalev. The dairy product segment is affected by global developments as well as positioning of the product portfolio in the segment. The milk processing segment is characterised simultaneously by the increase in global demand for agricultural products, abandonment of the EU support schemes and formulation of the supply conditions for domestic raw material. INCOME STATEMENT -------------------------------------------------------------------------------- | | Consolidated | | Consolidated | | -------------------------------------------------------------------------------- | | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | | 2nd | 2nd | 2nd | 2nd | 2nd | 2nd | | | quart | quarter | quarte | quarte | quarter | quarte | | | er | | r | r | | r | -------------------------------------------------------------------------------- | | conti | discontinu | Total | contin | disconti | Total | | | nued | ed | | ued | nued | | | | opera | operat | | operat | operations | | | tions | ions | | ions | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Revenue | 53844 | 251985 | 305829 | 47205 | 219577 | 266782 | -------------------------------------------------------------------------------- | Cost of sales of | -6242 | -192946 | -25537 | -26245 | -166157 | -19240 | | goods and | 6 | | 2 | | | 2 | | services | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Gross profit | -8582 | 59039 | 50457 | 20960 | 53420 | 74380 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Marketing | -7809 | -28247 | -36056 | -5800 | -23523 | -29323 | | expenses | | | | | | | -------------------------------------------------------------------------------- | Administrative | -1727 | -14021 | -31299 | -22492 | -8634 | -31126 | | and general | 8 | | | | | | | expenses | | | | | | | -------------------------------------------------------------------------------- | Other income and | -200 | -362 | -562 | 17473 | 190 | 17663 | | expenses | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit | -3386 | 16409 | -17460 | 10141 | 21453 | 31594 | | | 9 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other financial | -1009 | -5376 | -15466 | -5257 | -2196 | -7453 | | income and | 0 | | | | | | | expenses | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit before | -4395 | 11033 | -32926 | 4884 | 19257 | 24141 | | income tax | 9 | | | | | | -------------------------------------------------------------------------------- | Income tax | -143 | 0 | -143 | 0 | 0 | 0 | -------------------------------------------------------------------------------- | Profit before | -4410 | 11033 | -33069 | 4884 | 19257 | 24141 | | minority interest | 2 | | | | | | -------------------------------------------------------------------------------- | Minority interest | 0 | 8 | 8 | 0 | 13 | 13 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net profit for | -4410 | 11041 | -33061 | 4884 | 19270 | 24154 | | the financial | 2 | | | | | | | year | | | | | | | -------------------------------------------------------------------------------- | Net earnings per share | -1.40 | | | 1.2 | | held by the owners of the parent company | | | | | (basic and diluted; in kroons and euros) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | in thousands of euros | | | | | -------------------------------------------------------------------------------- | | Consolidated | | | Consolidated | -------------------------------------------------------------------------------- | | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | | 2nd | 2nd | 2nd | 2nd | 2nd | 2nd | | | quarte | quarter | quarte | quarter | quarter | quarte | | | r | | r | | | r | -------------------------------------------------------------------------------- | | contin | discont | Total | continu | disconti | Total | | | ued | inued | | ed | nued | | | | operat | operations | operati | operations | | | ions | | ons | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Revenue | 3441 | 16105 | 19546 | 3017 | 14034 | 17050 | -------------------------------------------------------------------------------- | Cost of sales of | -3990 | -12331 | -16321 | -1677 | -10619 | -12297 | | goods and services | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Gross profit | -548 | 3773 | 3225 | 1340 | 3414 | 4754 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Marketing expenses | -499 | -1805 | -2304 | -371 | -1503 | -1874 | -------------------------------------------------------------------------------- | Administrative and | -1104 | -896 | -2000 | -1438 | -552 | -1989 | | general expenses | | | | | | | -------------------------------------------------------------------------------- | Other income and | -13 | -23 | -36 | 1117 | 12 | 1129 | | expenses | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit | -2165 | 1049 | -1116 | 648 | 1371 | 2019 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other financial | -645 | -344 | -988 | -336 | -140 | -476 | | income and | | | | | | | | expenses | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit before | -2809 | 705 | -2104 | 312 | 1231 | 1543 | | income tax | | | | | | | -------------------------------------------------------------------------------- | Income tax | -9 | 0 | -9 | 0 | 0 | 0 | -------------------------------------------------------------------------------- | Profit before | -2819 | 705 | -2113 | 312 | 1231 | 1543 | | minority interest | | | | | | | -------------------------------------------------------------------------------- | Minority interest | 0 | 1 | 1 | 0 | 1 | 1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net profit for the | -2819 | 706 | -2113 | 312 | 1232 | 1544 | | financial year | | | | | | | -------------------------------------------------------------------------------- | Net earnings per share | -0.09 | | | 0.07 | | held by the owners of the parent company | | | | | (basic and diluted; in kroons and euros) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | in thousands of | Consol | |Consoli| | | | | | kroons | idated | |dated | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 2008 | 2008 | 2008 | 2007 | | 2007 | 2007 | | -------------------------------------------------------------------------------- | | 1st | 1st | 1st | 1st | 1st | 1st | | | half-ye | half-y | half-year | half-year | half-ye | half-year | | | ar | ear | | | ar | | -------------------------------------------------------------------------------- | | cont | discon | Total | cont | | discont | Total | | | | inue | tinued | | inue | | inued | | | | | d | | | d | | | | | | | operati | operations | operation | operations | | | | ons | | s | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Revenue | 1066 | | 511018 | 6176 | | 4892 | | 408833 | 45775 | | | | 40 | | | 58 | | 4 | | | 7 | | -------------------------------------------------------------------------------- | Cost of | -112 | | -37273 | -485 | | -268 | | -322569 | -3494 | | | sales of | 747 | | 3 | 480 | | 77 | | | 46 | | | goods and | | | | | | | | | | | | services | | | | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Gross | -610 | | 138285 | 1321 | | 2204 | | 86264 | 10831 | | | profit | 7 | | | 78 | | 7 | | | 1 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Marketing | -178 | | -50831 | -686 | | -744 | | -46043 | -5349 | | | expenses | 51 | | | 82 | | 7 | | | 0 | | -------------------------------------------------------------------------------- | Administra | -350 | | -21987 | -569 | | -299 | | -18565 | -4848 | | | tive and | 07 | | | 94 | | 22 | | | 7 | | | general | | | | | | | | | | | | expenses | | | | | | | | | | | -------------------------------------------------------------------------------- | Other | -622 | | -29 | -651 | | 1711 | | 469 | 17588 | | | income and | | | | | | 9 | | | | | | expenses | | | | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating | -595 | | 65438 | 5851 | | 1797 | | 22125 | 23922 | | | profit | 87 | | | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other | -178 | | -9908 | -277 | | -107 | | -2724 | -1344 | | | financial | 91 | | | 99 | | 23 | | | 7 | | | income and | | | | | | | | | | | | expenses | | | | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit | -774 | | 55530 | -219 | | -892 | | 19401 | 10475 | | | before | 78 | | | 48 | | 6 | | | | | | income tax | | | | | | | | | | | -------------------------------------------------------------------------------- | Income tax | -282 | | 0 | -282 | | 0 | | 0 | 0 | | -------------------------------------------------------------------------------- | Profit | -777 | | 55530 | -222 | | -892 | | 19401 | 10475 | | | before | 60 | | | 30 | | 6 | | | | | | minority | | | | | | | | | | | | interest | | | | | | | | | | | -------------------------------------------------------------------------------- | Minority | 0 | | 13 | 13 | | 0 | | 22 | 22 | | | interest | | | | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net profit | -777 | | 55543 | -222 | | -892 | | 19423 | 10497 | | | for the | 60 | | | 17 | | 6 | | | | | | financial | | | | | | | | | | | | year | | | | | | | | | | | -------------------------------------------------------------------------------- | Net earnings per | | -0.9 | | | | | 0.44 | | | share | | 4 | | | | | | | -------------------------------------------------------------------------------- | held by the owners of the | | | | | | | | | parent company | | | | | | | | -------------------------------------------------------------------------------- | (basic and diluted; in kroons | | | | | | | | | and euros) | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | in thousands of euros | | | | | -------------------------------------------------------------------------------- | | Consolidated | | | Consolidated | -------------------------------------------------------------------------------- | | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | | 1st | 1st | 1st | 1st | 1st | 1st | | | half-y | half-ye | half-y | half-y | half-yea | half-ye | | | ear | ar | ear | ear | r | ar | -------------------------------------------------------------------------------- | | contin | discont | Total | contin | disconti | Total | | | ued | inued | | ued | nued | | | | operat | operations | operat | operations | | | ions | | ions | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Revenue | 6816 | 32660 | 39476 | 3127 | 26129 | 29256 | -------------------------------------------------------------------------------- | Cost of sales of | -7206 | -23822 | -31028 | -1718 | -20616 | -22334 | | goods and services | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Gross profit | -390 | 8838 | 8448 | 1409 | 5513 | 6922 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Marketing expenses | -1141 | -3249 | -4390 | -476 | -2943 | -3419 | -------------------------------------------------------------------------------- | Administrative and | -2237 | -1405 | -3643 | -1912 | -1187 | -3099 | | general expenses | | | | | | | -------------------------------------------------------------------------------- | Other income and | -40 | -2 | -42 | 1094 | 30 | 1124 | | expenses | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit | -3808 | 4182 | 374 | 115 | 1414 | 1529 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other financial | -1143 | -633 | -1777 | -685 | -174 | -859 | | income and | | | | | | | | expenses | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit before | -4952 | 3549 | -1403 | -570 | 1240 | 669 | | income tax | | | | | | | -------------------------------------------------------------------------------- | Income tax | -18 | 0 | -18 | 0 | 0 | 0 | -------------------------------------------------------------------------------- | Profit before | -4970 | 3549 | -1421 | -570 | 1240 | 669 | | minority interest | | | | | | | -------------------------------------------------------------------------------- | Minority interest | 0 | 1 | 1 | 0 | 1 | 1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net profit for the | -4970 | 3550 | -1420 | -570 | 1241 | 671 | | financial year | | | | | | | -------------------------------------------------------------------------------- | Net earnings per share | -0,06 | | | 0,03 | | held by the owners of the parent company | | | | | (basic and diluted; in kroons and euros) | | | | -------------------------------------------------------------------------------- BALANCE SHEET -------------------------------------------------------------------------------- | | Consolidated EEK | | | -------------------------------------------------------------------------------- | | 31.12.20 | 31.12.2007 | 31.12.20 | 30.06.20 | | | 07 | | 07 | 07 | -------------------------------------------------------------------------------- | | continued| discontinued| Total | | | | operatio | operations | | | | ns | | | -------------------------------------------------------------------------------- | ASSETS | | | | | -------------------------------------------------------------------------------- | Current assets | | | | | -------------------------------------------------------------------------------- | Cash | 7997 | 5119 | 13116 | 17337 | -------------------------------------------------------------------------------- | Receivables | 52428 | 95506 | 147934 | 148050 | -------------------------------------------------------------------------------- | Prepayments | 3432 | 630 | 4062 | 2653 | -------------------------------------------------------------------------------- | Inventories | 246019 | 69607 | 315626 | 218617 | -------------------------------------------------------------------------------- | Total current assets | 309876 | 170862 | 480738 | 386657 | -------------------------------------------------------------------------------- | Non-current assets | | | | | -------------------------------------------------------------------------------- | Long-term investments and | 3779 | 0 | 3779 | 3733 | | receivables | | | | | -------------------------------------------------------------------------------- | Investment property | 237679 | 0 | 237679 | 214601 | -------------------------------------------------------------------------------- | Property, plant and equipment | 173174 | 526083 | 699257 | 644876 | -------------------------------------------------------------------------------- | Intangible assets | 67882 | 0 | 67882 | 62635 | -------------------------------------------------------------------------------- | Total non-current assets | 482514 | 526083 | 1008597 | 925846 | -------------------------------------------------------------------------------- | TOTAL ASSETS | 792390 | 696945 | 1489335 | 1312503 | -------------------------------------------------------------------------------- | LIABILITIES AND OWNER'S | | | | | | EQUITY | | | | | -------------------------------------------------------------------------------- | Liabilities | | | | | -------------------------------------------------------------------------------- | Borrowings | 303014 | 60512 | 363526 | 348317 | -------------------------------------------------------------------------------- | Prepayments received from | 14561 | 41 | 14602 | 1461 | | customers | | | | | -------------------------------------------------------------------------------- | Accounts payable and other | 182284 | 174979 | 357263 | 284439 | | payables | | | | | -------------------------------------------------------------------------------- | Total current liabilities | 499859 | 235532 | 735391 | 634218 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Non-current liabilities | | | | | -------------------------------------------------------------------------------- | Borrowings | 193913 | 208838 | 402751 | 304837 | -------------------------------------------------------------------------------- | Total non-current liabilities | 193913 | 208838 | 402751 | 304837 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES | 693772 | 444370 | 1138142 | 939054 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Owners' equity | | | | | -------------------------------------------------------------------------------- | Share capital | 236325 | | 236325 | 236325 | -------------------------------------------------------------------------------- | Mandatory reserve | 5543 | | 5543 | 4020 | -------------------------------------------------------------------------------- | Revaluation reserve | 111108 | | 111108 | 111108 | -------------------------------------------------------------------------------- | Retained earnings | -1824 | | -1824 | 21941 | -------------------------------------------------------------------------------- | Total owner's equity | 351152 | | 351152 | 373395 | -------------------------------------------------------------------------------- | Minority interest | 0 | 41 | 41 | 54 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES, | 1044924 | 444411 | 1489335 | 1312503 | -------------------------------------------------------------------------------- | MINORITY INTEREST | | | | | -------------------------------------------------------------------------------- | AND OWNER'S EQUITY | | | | | -------------------------------------------------------------------------------- | difference between | -252534 | 252534 | 0 | 0 | | investments in equity | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | Consolidated EUR | | | -------------------------------------------------------------------------------- | | 31.12.20 | 31.12.2007 | 31.12.20 | 30.06.20 | | | 07 | | 07 | 07 | -------------------------------------------------------------------------------- | | continued| discontinued| Total | | | | operatio | operations | | | | ns | | | -------------------------------------------------------------------------------- | ASSETS | | | | | -------------------------------------------------------------------------------- | Current assets | | | | | -------------------------------------------------------------------------------- | Cash | 511 | 327 | 838 | 1108 | -------------------------------------------------------------------------------- | Receivables | 3351 | 6104 | 9455 | 9462 | -------------------------------------------------------------------------------- | Prepayments | 219 | 40 | 260 | 170 | -------------------------------------------------------------------------------- | Inventories | 15723 | 4449 | 20172 | 13972 | -------------------------------------------------------------------------------- | Total current assets | 19805 | 10920 | 30725 | 24712 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Non-current assets | | | | | -------------------------------------------------------------------------------- | Long-term investments and | 242 | 0 | 242 | 239 | | receivables | | | | | -------------------------------------------------------------------------------- | Investment property | 15190 | 0 | 15190 | 13716 | -------------------------------------------------------------------------------- | Property, plant and equipment | 11068 | 33623 | 44691 | 41215 | -------------------------------------------------------------------------------- | Intangible assets | 4338 | 0 | 4338 | 4003 | -------------------------------------------------------------------------------- | Total non-current assets | 30838 | 33623 | 64461 | 59172 | -------------------------------------------------------------------------------- | TOTAL ASSETS | 50643 | 44543 | 95186 | 83884 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | LIABILITIES AND OWNER'S EQUITY | | | | -------------------------------------------------------------------------------- | Liabilities | | | | | -------------------------------------------------------------------------------- | Current liabilities | | | | | -------------------------------------------------------------------------------- | Borrowings | 19366 | 3867 | 23234 | 22262 | -------------------------------------------------------------------------------- | Prepayments received from | 931 | 3 | 933 | 93 | | customers | | | | | -------------------------------------------------------------------------------- | Accounts payable and other | 11650 | 11183 | 22833 | 18179 | | payables | | | | | -------------------------------------------------------------------------------- | Total current liabilities | 31947 | 15053 | 47000 | 40534 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Non-current liabilities | | | | | -------------------------------------------------------------------------------- | Borrowings | 12393 | 13347 | 25740 | 19483 | -------------------------------------------------------------------------------- | Total non-current liabilities | 12393 | 13347 | 25740 | 19483 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES | 44340 | 28400 | 72741 | 60017 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Owners' equity | | | | | -------------------------------------------------------------------------------- | Share capital | 15104 | 0 | 15104 | 15104 | -------------------------------------------------------------------------------- | Mandatory reserve | 354 | 0 | 354 | 257 | -------------------------------------------------------------------------------- | Revaluation reserve | 7101 | 0 | 7101 | 7101 | -------------------------------------------------------------------------------- | Retained earnings | -117 | 0 | -117 | 1402 | -------------------------------------------------------------------------------- | Total owner's equity | 22443 | 0 | 22443 | 23864 | -------------------------------------------------------------------------------- | Minority interest | 0 | 3 | 3 | 3 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES, | 66783 | 28403 | 95186 | 83884 | -------------------------------------------------------------------------------- | MINORITY INTEREST | | | | | -------------------------------------------------------------------------------- | AND OWNER'S EQUITY | | | | | -------------------------------------------------------------------------------- | difference between | 16140 | -16140 | 0 | 0 | | investments in equity | | | | | -------------------------------------------------------------------------------- Tarmo Maasikamäe Financial director tel +3726161900 grupp@kalev.ee