Tulikivi Corporation's annual report for 2004 was published today and will be mailed to shareholders. The annual report is also available on the company's website at www.tulikivi.com.
TULIKIVI CORPORATION
Juha Sivonen Managing Director
Distribution: - Helsinki Stock Exchange
Tulikivi CORPORATION STOCK EXCHANGE RELEASE 83900 Juuka 3 March 2005, at 17.30 pm
ADOPTION OF IFRS REPORTING BY TULIKIVI
As from 1 January 2005, the Tulikivi Group has applied IFRS standards (International Financial Reporting Standards) in its reporting. The financial statements for the year ended 31 December 2005 will be the first IFRS financial statements and the interim report for the quarter ended 31 March 2005 will be the first IAS 34 compliant interim financial report The Tulikivi Group’s date of transition to IFRS is 1 January 2004.
Tulikivi has adopted IFRS 1 (First-time Adoption of International Financial Reporting Standards) and the following exemptions permitted by it: Business combinations, employee benefits and cumulative translation differences. The accompanying financial information has been compiled in accordance with IAS/IFRS standards in force at the date of this release.
This release provides information on the effects of the adoption of IFRS on the balance sheet at the date of transition and on the 2004 income statement and balance sheet, which were originally presented in accordance with Finnish Accounting Standards (FAS). The Tulikivi Group’s accounting policies are included in the 2004 annual financial statements. The release also presents reconciliations of equity at 1 January 2004 and at each quarter end for 2004 and a reconciliation of the net profit for 2004 for each quarter and for the whole year The effects of the adoption of IFRS are as follows (referenced to the reconciliations):
(1) Pension obligations
When determining pension obligations at the date of transition, the disability element of the Finnish TEL pension scheme has been accounted for as a defined benefit plan in accordance with IAS 19. The actuarially calculated disability obligation of EUR 12 million has been recognised in the balance sheet at the date of transition In December 2004 the Ministry of Social Affairs and Health approved certain changes to the accounting of obligations for disabilities. The changes are effective on 1 January 2006 As a result of these changes, the disability element of TEL is accounted for as a defined contribution plan under IFRS The resulting material reduction in pension obligations has been recognised as a non- recurring gain in the 2004 IFRS income statement, amounting to EUR 11 million. The disability obligation is under EUR 01 million in the IFRS balance sheet at 31 December 2004.
(2) Amortization of goodwill
In accordance with IFRS 3, goodwill is no longer amortized on a systematic basis but tested annually for impairment in accordance with IAS 36 This change improves earnings before tax in 2004 by EUR 03 million.
(3) Intangible assets
In accordance with IAS 38, intangible assets arising from development shall be recognised if certain criteria are met Based on this, intangible assets arising from the development of new products and production methods in 2004 and meeting the criteria, were activated in the 2004 FAS financial statements. In accordance with IAS 38, expenditure on advertising and promotional activities is recognised as an expense when the goods have been delivered or the service rendered Under FAS, certain such expenditure has been allocated over a period when it has been estimated that economic benefits will mainly flow in the subsequent financial period. This change reduces inventories at the date of transition by EUR 01 million and other receivables by EUR 03 million at 31 December 2004 It also increases other operating expenses in the IFRS income statement by EUR 02 million.
(4) Income taxes
In accordance with IAS 12, deferred tax liabilities and assets shall be recognised, as a rule, for all taxable temporary differences. In the IFRS income statement, changes in deferred tax liabilities and assets arising from these differences have been added to the change in deferred tax liabilities under FAS. This resulted in a net increase of EUR 04 million in the deferred tax liability. The corresponding changes are included in the deferred tax liabilities and assets in the IFRS balance sheet In 2004 the Group recognised an additional amount on the purchase of shares in a subsidiary A deferred tax liability of EUR 01 million was recognised, relating to this additional purchase price, allocated to stone reserves.
(5) Property, plant and equipment
An amount of EUR 05 million, representing the portion of the additional purchase price of shares in a subsidiary, allocated to stone reserves, is included in property, plant and equipment in the IFRS balance sheet, whereas it is included in intangible assets in the FAS balance sheet. In addition, tangible assets have been increased in the IFRS balance sheet by the related deferred tax liability of EUR 01 million.
(6) Events after the balance sheet date
A dividend of EUR 46 million has been recognised in the first quarter in the FAS financial statements and in the second quarter in the IFRS balance sheet, in accordance with IAS 10.
Cash flow statement
There are no material differences between the FAS cash flow statement and the IFRS cash flow statement.
Segment reporting
The operations of the Tulikivi Group consist of the fireplace business and the architectural stone business. This is the primary segment reporting format of the Group.
The secondary segment reporting format is based on the geographical location of the clients. The geographical segments are: Finland, Rest of Europe and the USA The reporting of assets is based on their location.
IFRS RECONCILIATIONS EUR million
1.RECONCILIATION OF EQUITY
Jan Mar Jun Sep Dec 1 31 30 30 31 2004 2004 2004 2004 2004 Equity under FAS 24.4 20.4 20.9 22.1 23.2 IAS 19 Employee benefits -1.2 -1.2 -1.2 -1.2 (1) IFRS 3 Business compination 0.1 0.2 0.2 0.3 (2) IAS 38 Intangible assets (3) -0.1 -0.3 -0.2 -0.2 -0.3 0.4 0.4 0.3 0.3 IAS 12 Income taxes (4) IAS 10 Events after the 4.6 balance sheet date (6) Equity under IFRS 23.5 24.0 20.0 21.2 23.2
2.RECONCILIATION OF PROFIT OR LOSS FOR 2004 Q1/ Q2/ Q3/ Q4/ 2004 2004 2004 2004 2004 Profit of loss for the period under FAS 0.6 0.5 1.2 1.2 3.5 IAS 19 Employee benefits 1.1 1.1 (1) IFRS 3 Business compination (2) 0.1 0.1 0.1 0.3 IAS 38 Intangible assets(3) -0.2 0.1 -0.1 -0.2 IAS 12 Income taxes (4) -0.1 -0.3 -0.4 Profit and loss for the 0.5 0.6 1.2 2.0 4.3 period under IFRS
2 RECONCILIATION OF PROFIT OR LOSS FOR 2004 Q1/ Q2/ Q3/ Q4/ 2004 2004 2004 2004 2004 Profit of loss for the period under FAS 0.6 0.5 1.2 1.2 3.5 IAS 19 Employee benefits (1) 1.1 1.1 IFRS 3 Business compination (2) 0.1 0.1 0.1 0.3 IAS 38 Intangible assets(3) -0.2 0.1 -0.1 -0.2 IAS 12 Income taxes (4) -0.1 -0.3 -0.4 Profit and loss for the 0.5 0.6 1.2 2.0 4.3 period under IFRS
FAS IFRS- IFRS Jan- ad- Jan- Dec jus- Dec 3 CONSOLIDATED INCOME 2004 ments 2004 STATEMENT EUR million Sales 55.3 55.3 Other operating income 0.5 0.5 Increase/decrease inventories 0.5 0.5 in finished goods and in work in progress Production for own use 0.8 0.8
Raw materials and consumables 9.0 0.1 8.9 (3) External services 7.0 7.0 Personnel expenses (1) 20.1 1.1 19.0 Depreciation (2) 4.3 0.3 4.0 Other operating expenses 11.7 -0.3 12.0 Operating profit (3) 5.0 1.2 6.2 Percentage of sales 9.1 11.4
Finance costs-net -0.1 -0.1 Profit before tax 4.9 1.2 6.1 Percentage of sales 8.8 11.1 Direct taxes (4) 1.4 -0.4 1.8 Profit for the year 3.5 0.8 4.3
FAS IFRS Key financial rations Jan to Jan Dec to Dec 2004 2004
Earnings per share. EUR 0.38 0.48
4. CONSOLIDATED BALANCE SHEET IFRS- IFRS IFRS- IFRS ad- 1 FAS ad- 31 FAS just- Jan. 31 just- Dec. 1 ments 2004 Dec. ments 2004 Jan. 2004 2004
Assets Non current assets Property, plant and equipment(4,5) 16.2 0.1 16.3 15.5 0.6 16.1 Goodwill (2) 0.6 0.6 0.3 0.3 0.6 Other intangible assets (5) 3.3 -0.1 3.2 3.8 -0.5 3.3 Investment properties 0.2 0.2 0.2 0.2 Available-for-sale investment 0.1 0.1 0.1 0.1 Deferred income tax assets 0.7 0.4 1.1 0.6 0.1 0.7 (4) Total non-current assets 21.1 0.4 21.5 20.5 0.5 21.0 Current assets Inventories (3) 7.0 -0.1 6.9 7.5 7.5 Trade and other receivables (3) 7.1 7.1 7.6 -0.3 7.3 Prepaid expenses 0.3 0.3 Financial assets at fair value through profit 0.7 0.7 0.7 0.7 or loss Cash and cash eguivalents 5.8 5.8 5.1 5.1 Total current assets 20.6 -0.1 20.5 21.2 -0.3 20.9 Total assets 41.7 0.3 42.0 41.7 0.2 41.9
Equity and liabilities Share capital 6.2 6.2 6.2 6.2 Share prenium fund 5.4 5.4 5.4 5.4 Retained earnings 12.8 -0.9 11.9 11.6 11.6 Total equity 24.4 -0.9 23.5 23.2 23.2
Non-current liabilities Deferred income tax 0.7 0.7 0.5 0.2 0.7 liabilities (4) Retirement benefit 1.2 1.2 obligations (1) Provisions 0.1 0.1 0.2 0.2 Interest-bearing debt 5.0 5.0 6.1 6.1 Other debt 0.4 0.4 Total non-current liabilities 5.8 1.2 7.0 7.2 0.2 7.4
Current liabilities Trade and other payables 8.4 8.4 8.8 8.8 Current income tax liabilities 0.3 0.3 Short-term interest- 2.8 2.8 2.5 2.5 bearing debt Total current liabilities 11.5 11.5 11.3 11.3
Total liabilities 17.3 1.2 18.5 18.5 0.2 18.7
Total equity and liabilities 41.7 0.3 42.0 41.7 0.2 41.9
KEY FINANCIAL RATIOS FAS IFRS 31Dec. 31Dec. 2004 2004
Return on equity, % 14.7 18.7 Return on capital employed, % 16.2 19.8 Current ratio 1.9 1.9 Equity ratio, % 55.6 55.3 Gearing, % 12.1 12.1 Equity per share, EUR 0.38 0.48 Interest-bearing debt, EUR million 8.6 8.6
The method of calculating the key financial ratios is the same as in the 2004 FAS financial statements.
TULIKIVI CORPORATION Board of Directors
Distribution: The Helsinki Stock Exchange Central Media
Additional information: Tulikivi Oyj, 83900 Juuka, tel 013- 681 111, www.tulikivi.com Chairman of Board of Directors Matti Virtaala Managing Director Juha Sivonen
Shareholders of Tulikivi Corporation are invited to the Annual General Meeting to be held on 31 March 2005 at 10 a.m. at the Kivikylä Auditorium in Nunnanlahti, Juuka.
The following matters will be on the agenda of the meeting:
1) Matters specified as being the business of Annual General Meetings in Article 10 of the Articles of Association.
2)Proposal of the Board of Directors to authorise the Board of Directors to decide on the acquisition of the company’s own shares
The Board of Directors is authorised to decide on the acquisition of the company´s own shares with the following terms:
a)The company’s own shares are acquired to solidify the company’s capital structure and to be used as compensation in business and company acquisitions and other structural arrangements. The manner and scope of these transactions is at the discretion of the Board of Directors. The Board of Directors can also initiate the invalidation of shares by decreasing the capital stock.
b)No more than a total of 336,069 Series A shares of the company shall be acquired and no more than a total of 119,250 Series K shares of the company shall be acquired.
c)The shares shall be acquired as follows:
The company’s A shares may be acquired in disproportion to shareholders’ holdings and are to be acquired through public trading on the Helsinki Stock Exchange as decided upon by the Board of Directors. The price of the shares is determined at the time of purchase in accordance with the rules and regulations of the Helsinki Stock Exchange.
The company’s K shares are to be acquired in proportion to the values of shareholder ownership by making a purchase offer to K shareholders. The value of the offer is determined by calculating the weighted average value of the A shares for a period of two weeks of public trading on the Helsinki Stock Exchange prior to the signing of the purchase offer. In the event that the number
of K shares stated in the decision reached by the shareholder’s meeting cannot be acquired in this manner, the Board may acquire the remainder of the shares from those owners of K shares who are willing to sell more than their relative proportion of the number of shares to be acquired. In the event that the number of shares offered exceeds the number of shares to be acquired, the Board will consider the ownership of the vendors and number of shares offered and decide how the acquisition is to be divided among those offering their shares for sale.
d)The acquisition of shares is to be carried out using distributable earnings. The acquisition therefore reduces the total non-restricted distributable equity.
e)The authorisation for share acquisition is valid until the Annual General Meeting in 2006, however for not more than one full year after the decision reached by the Annual General Meeting.
f)Other matters pertaining to the acquisition of shares are at the discretion of the Board of Directors.
3)Proposal of the Board of Directors to authorise the Board of Directors to decide on the disposal of the company’s own shares
The Board of Directors is authorised to decide on the disposal of the company’s own shares on the following terms:
a)The authorised total number of shares is not to exceed 336,069 A shares and 119,250 K shares acquired for the company.
b)The Board of Directors is authorised to decide to whom and in what order the shares will be transferred to. The Board of Directors has total discretion over the disposal of the shares in disproportion to the shareholders’ pre-emptive rights to the company shares.
c)The shares are to be disposed of as compensation in business and company acquisitions or used in other structural arrangements over which the Board of Directors has complete discretion. In addition, the Board of Directors suggests that the Annual General Meeting authorise the Board of Directors to make decisions on the sale of company’s own A shares through public trading on the Helsinki Stock Exchange to secure funds for future company acquisitions or investments.
d)The Board of Directors shall determine the transfer price of the shares and the principles used to establish that transfer price.
Shares may be transferred in exchange for non-monetary remuneration.
e)The authorisation to dispose of shares is valid until the Annual General Meeting in 2006, however for not more than one full year beginning from the decision reached by the Annual General Meeting.
f)Other matters pertaining to the disposal of shares are at the discretion of the company´s Board of Directors.
4)Proposal on payment of dividends
The Board of Directors proposes to the Annual General Meeting that a dividend be paid of EUR 0.23 per share for A shares and EUR 0.22 per share for K shares. The dividend decided upon by the Annual General Meeting is to be paid to shareholders registered by the date of record in the shareholder registry kept by Finnish Central Securities Depository Ltd. The Board of Directors has agreed that the date of record for payment of the dividend shall be 5 April 2005. The Board of Directors proposes to the Annual General Meeting that the dividend be paid after the record date on 12 April 2005.
5) Proposal on composition of the Board of Directors and auditor
The appointment committee proposes to the Annual General Meeting that the following people be elected as Board members for the next term of office: Bishop Ambrosius, Juhani Erma, Eero Makkonen, Aimo Paukkonen, Heikki Vauhkonen, Reijo Vauhkonen and Matti Virtaala.
The Board of Directors proposes to the Annual General Meeting that Authorised Public Accountants PricewaterhouseCoopers Oy be chosen as the company’s auditor, with Hannele Selesvuo, APA, as chief auditor.
Documents (and appendices to these documents) pertaining to final accounts for 2004 as well as the Board of Directors’ proposals for authorising the Board of Directors to acquire and dispose of the company’s own shares are available for inspection by shareholders at the company headquarters at Kuhnustantie 10, 83900 Juuka, as from 21 February 2005. Copies will be mailed to shareholders on request. The Annual Report will be mailed to shareholders the week of 11 March.
The right to participate in the general shareholders’ meeting is given to shareholders who are registered in the Shareholder registry kept by Finnish Central Securities Depository Ltd (Suomen Arvopaperikeskus Oy) on 21 March 2005.
A shareholder wishing to participate in the Annual General Meeting is obligated to notify the company thereof by 4 p.m. on 21 March 2005. The notification must be made either by phone to Ms Kaisa Toivanen, tel. +358 (0)13 681 111, by e-mail to kaisa.toivanen@tulikivi.fi, or by post to the address Tulikivi Corporation/Annual General Meeting, FIN-83900 Juuka, Finland. Any power of attorney notifications must be submitted together with the preliminary enrolment for the meeting.
Board of Directors Juuka, 16 February 2005
Tulikivi Corporation
ADDITIONAL INFORMATION: Tulikivi Corporation, FIN-83900 Juuka, Finland, tel. 358-13-681 111, www. tulikivi.com – Chairman of the Board of Directors Matti Virtaala – Managing Director Juha Sivonen
DISTRIBUTION: Helsinki Stock Exchange and Principal Media
Annual General Meeting The Board of Directors of Tulikivi Corporation has made a decision to invite the Annual General Meeting on 31st, April 2005 at10 a.m. in Juuka. The Annual General Meeting will handle the issues pertaining to the Annual General Meeting. Additionally, the Board of Directors will propose to the Annual General Meeting that the authorization to acquire and relinquish company´s own shares will be renewed so that no more than a total of 336,069 A-shares and no more than a total of 119,250 K-shares of the company shall be acquired/relinquished. The invitation to the Annual General Meeting will be published later.
Nomination Committee Board of Directors has decided to establish a Nomination Committee. The composition of the Nomination Committee departs from the recommendation for the corporate governance to the publicly listed companies. The Nomination Committee comprises of two members of the Board of Directors and one external member. The Nomination Committee is comprised of the Chairman of the Board of Directors Matti Virtaala, the Vice Chairman of the Board of Directors Reijo Vauhkonen and the Doctor of Economic Sciences, h.c. Ahti Hirvonen.
Board of Directors
Distribution: Helsinki Stock Exchange, Central Media
Additional Information: Tulikivi Corporation, 83900 Juuka, tel. +358-13-681 111, www. Tulikivi.com – Chairman of the Board of the Directors Matti Virtaala
The Tulikivi Group’s profit before extraordinary items increased over 14% during the financial year and amounted to MEUR 4.9 million (MEUR 4.3 in 2003). Return on investment was 16.2 (13.7) %. The Group’s net sales were MEUR 55.3 (53.6). The cash flow from operating activities before investments was MEUR 6.6 (8.2).
Net sales and result In 2004, the Tulikivi Group’s net sales increased by 3.1 per cent to EUR 55.3 million (EUR 53.6 million in 2003). The net sales of the Fireplace Business were EUR 49.0 million (45.3), up 8.2 per cent. Sales of lining stones and fireplaces grew equally well. Lining stones account for a significant share of the Group’s net sales. Kivia Oy’s share of the Group’s net sales was EUR 3.0 million. The net sales of the Architectural Stone Business were in line with the target and amounted to EUR 6.3 million (8.3).
The share of aggregate net sales derived in Finland was EUR 27.6 million (27.7), or 50.0 per cent (51.7). Exports yielded net sales of EUR 27.7 million (25.9). The biggest export countries were Germany and Sweden. Exports of fireplaces to Germany declined.
The Group’s operating profit improved by 19.2 per cent to EUR 5.0 million (4.2). The Group’s profit before extraordinary items amounted to EUR 4.9 million (4.3), representing 8.8 per cent (7.9) of net sales. The result of the Fireplace Business amounted to EUR 5.0 million (5.2). The result of the Architectural Stone Business was EUR -0.1 million (-0.9). Kivia’s result was in the black.
The Group’s return on capital employed stood at 16.2 per cent (13.7). Earnings per share amounted to EUR 0.38 (0.34). The taxes included in the calculations are the taxes of the Group companies for the financial year.
Cash flow and financing The Group’s financial position remained good. The cash flow from operating activities before investments was EUR 6.6 million (8.2). The Group’s working capital grew by EUR 0.8 million (-1.2) during the financial year. The current ratio was 1.9 (1.8). The equity ratio was 56.1 per cent (58.7). The ratio of interest-bearing net debt to shareholders’ equity, or gearing, was 12.1 per cent (5.5). Own capital investment ratio was 1.8 per cent (3.1). Equity per share amounted to EUR 2.55 (2.68). Financial income during the financial year amounted to EUR 0.2 million and financial expenses to EUR 0.3 million.
Investments and development activities The Group’s fixed assets investments amounted to EUR 3.9 million (2.9). The major investments were earmarked for machinery to develop productivity and product finishing as well as for the opening and exploration of quarries.
R&D expenditure totalled EUR 1.5 million (1.3). The main focus in R&D was on the development of a new generation of products designed from the ground up to make use of different types of soapstone. In addition to new soapstone fireplaces, the company brought to market a new lightweight fireplace and tiled soapstone fireplaces during financial year.
Personnel During the financial year, the Group employed an average of 513 persons (555) and at the end of the year, the Group’s personnel numbered 535 persons (562). Of these employees, 490 (494) worked for the Fireplace Business and 45 (68) for the Architectural Stone Business. Thanks to the Group’s result for 2004, personnel can be paid incentive pay. The effect on earnings of the incentive pay and the related social expenses amounts to EUR 0.7 million.
Board of Directors, Managing Director and Auditors At Tulikivi Corporation’s Annual General Meeting, held on 20 April 2004, Bishop Ambrosius, Mr. Juhani Erma, Mr. Eero Makkonen, Mr. Aimo Paukkonen, Mr. Heikki Vauhkonen, Mr. Reijo Vauhkonen and Mr. Matti Virtaala were elected to serve on the Board of Directors. From amongst its number, the Board of Directors appointed Mr. Matti Virtaala as Chairman and Mr. Reijo Vauhkonen as Vice Chairman. The Managing Director of Tulikivi Corporation is Mr. Juha Sivonen. The auditors are PricewaterhouseCoopers Oy, Authorised Public Accountants.
Own shares The Board of Directors of Tulikivi Corporation has an authorisation from the Annual General Meeting to both buy back and transfer a maximum of 336,069 of the company’s Series A shares and a maximum of 119,250 of the company’s Series K shares. The company did not possess any of its own shares on 31 December 2004.
Quotation and trading of the Series A share In 2004, a total of 1,333,481 Tulikivi Corporation Series A shares were traded on the Helsinki Stock Exchange. The total value of share turnover was EUR 9.0 million. The highest trading price of the share was EUR 8.20 and the lowest EUR 5.25. The closing rate for the report period was EUR 6.32.
Environmental obligations On the basis of the Mining Act and environmental legislation, Tulikivi Corporation has landscaping obligations that must be met when quarries are eventually shut down. In accordance with the operating principles of the Group, the actions required under these landscaping obligations are continuously carried out as part of production quarrying. Thus, no significant additional costs are expected.
Adoption of IFRS The Tulikivi Group will adopt IFRS reporting from the beginning of 2005. On 3 March 2005, the company will publish a separate bulletin on the transition to IFRS as well as on the effects of the transition on shareholders’ equity on 1 January 2004 and 31 December 2004 and on the result for 2004. The Group’s shareholders’ equity on 31 December 2004 under IFRS does not significantly deviate from the shareholders’ equity presented under the current accounting principles.
The Board’s dividend proposal The Board of Directors will propose to the Annual General Meeting that will convene on 31 March 2005 that a dividend of EUR 0,23 per share be paid for the Series A shares and EUR 0,22 per share for the Series K shares, to a total of EUR 2,1 million.
Outlook for the future In Finland, economic growth is expected to remain moderate. Growth in the construction of single-family houses is ongoing. Economic growth is slower in continental Europe. The company is improving its distribution system in Germany; this is expected to have a positive effect in the future. Growth is expected to continue in the other export countries. The trend in the Group’s net sales and earnings will remain positive at the annual level.
The order book at the end of the report period was EUR 5.4 million (7.1), of which the Fireplace Business accounted for EUR 4.9 million (6.4) and the Architectural Stone Business for EUR 0.5 million (0.7).
CONSOLIDATED INCOME STATEMENT ME 01-12/ 01-12/ Change, 2004 2003 % Net sales 55.3 53.6 3.1 Change in inventories of finished products 0.5 0.4 Production for own use 0.8 0.4 Other operating income 0.5 0.5
Materials and external charges 16.0 14.9 Personnel expenses 20.1 20.7
4(7) Depreciation and value adjustments 4.3 4.1 Other operating expenses 11.7 11.0
Operating profit 5.0 4.2 19.2 % of net sales 9.1 7.9
Financial income and expenses -0.1 0.1
Profit before extraordinary items 4.9 4.3 14.4 % of net sales 8.8 7.9
Income taxes 1.4 1.3
Profit for the year 3.5 3.0 14.0
CONSOLIDATED BALANCE SHEET ME 12/2004 12/2003 Assets Fixed assets and other non- current investments Intangible assets 3.8 3.3 Goodwill 0.3 0.6 Tangible assets Land areas 1.1 1.1 Buildings 6.3 6.4 Machinery and equipment 8.3 8.8 Other tangible assets 0.1 Investments 0.1 0.1 Fixed assets and other non-current investments total 19.9 20.4 Current assets Inventories 7.5 7.0 Long term receivables Deferred tax assets 0.6 0.7 Current receivables Trade receivables 6.8 6.6 Other current receivables 1.1 0.5 Financial asset securities 0.7 0.7 Cash in hand and at banks 5.1 5.8 Total current assets 21.8 21.3 Total assets 41.7 41.7
Liabilities and shareholders´equity Shareholders´equity Capital stock 6.2 6.2 Other shareholders´equity 17.0 18.2 Total shareholders´equity 23.2 24.4 Provisions 0.2 0.1
Liabilities Non-current liabilities Deferred tax liabilities 0.5 0.7 Loans from credit institutions 6.1 5.0 Other non-current liabilities 0.4 Total non-current liabilities 7.0 5.7 Current liabilities Loans from credit institutions 2.5 2.8 Account payables 1.7 1.0 Other current liabilities 7.1 7.7 Total current liabilities 11.3 11.5 Total liabilities and Shareholders´ equity 41.7 41.7
Interest bearing liabilities 8.6 7.8 Advance received 0.4 0.1
CASH FLOW STATEMENT 01-12/ 01-12/ ME 2004 2003 Profit before extraordinary items 4.9 4.3 Depreciation and other adjustments 4.5 4.1 Change in net working capital -0.8 1.2 Financial items and taxes -2.0 -1.4 Cash flow from operating activities 6.6 8.2
Investments in fixed assets -3.7 -2.6 Investments in other investments -0.1 -0.8 Proceeds from sale of fixed assets and other changes in fixed assets 0.3 0.1 Net cash used in investing activities -3.5 -3.3
Cash flow before financing activities 3.1 4.9
Long-term borrowing 5.6 Repayment of long-term loans -4.8 -2.1 Dividends paid -4.6 -4.2 Net cash flow from financing activities -3.8 -6.3
Net increase (+)/decrease(-) in cash and cash equivalents -0.7 -1.4 Cash and cash equivalents at the beginning of the period 5.8 7.2 Cash and cash equivalents at the end of the period 5.1 5.8
KEY RATIOS DESCRIBING ECONOMIC DEVELOPMENT AND KEY INDICATORS PER SHARE
12/2004 12/2003 Order stock (December 31), ME 5.4 7.1 Gross investments, ME 3.9 2.9 Gross investments, %/net sales 7.1 5.4 Average number of personnel 513 555 Number of personnel at the end of year 535 562 Earnings per share, Euro 0.38 0.34 Equity/share, Euro 2.55 2.68 Solvency ratio, % 56.1 58.7 Gearing, % 12.1 5.5 Current ratio 1.9 1.8 Return on capital employed 16.2 13.7 Average number of shares 9106385 9106385 Number of outstanding shares on December 31 9106385 9106385
CONTINGENT LIABILITIES MEUR 012/2004 12/2003 Loans from credit institutions and other non-current liabilities for which mortgages and pledges have been given 7.6 6.0 Given mortgages and pledges 10.8 8.0 Other mortgages and pledges given on behalf of own liabilities 1.7 1.7
Off-balance sheet financial instruments The significance of off-balance sheet financial instruments is minor.
QUARTERLY DEVELOPMENT OF THE GROUP EUR million Q4/ Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2004 2004 2004 2003 2003 2003 2003
Net sales 15.9 13.3 12.8 13.3 15.3 13.8 12.6 11.9 Operating profit 1.7 1.7 0.7 0.9 1.7 1.6 0.6 0.3 Result before extra- ordinary items 1.7 1.6 0.7 0.9 1.8 1.6 0.6 0.3
QUARTERLY DEVELOPMENT OF BUSINESSES AREAS EUR million Q4/ Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2004 2004 2004 2003 2003 2003 2003 Fireplace business Net sales 14.3 11.6 11.0 12.1 13.6 11.6 10.4 9.7 Result before extra- ordinary items 1.7 1.5 0.7 1.1 1.9 2.1 0.7 0.5
Architectural stone business Net sales 1.6 1.7 1.8 1.2 1.7 2.2 2.2 2.2 Result before extra- ordinary items 0.0 0.1 0.0 -0.2 -0.1 -0.5 -0.1 -0.2
LARGEST SHAREHOLDERS ON 31 DECEMBER 2004 Name of shareholder Number of Proportion of shares total vote Vauhkonen Reijo 1,038,977 24.4 % Vauhkonen Heikki 749,242 23.8 % Vauhkonen Eliisa 724,255 5.4 % Virtaala Matti 604,027 12.0 % Mutual Pension Insurance Company Ilmarinen 515,595 1.7 % Mutanen Susanna 449,375 7.3 % Investment Fund Phoebus 212,000 0.7 % Vauhkonen Mikko 200,175 3.6 % Nuutinen Tarja 168,635 3.5 % Fondita Nordic Small Cap Placfond 163,100 0.5 % Other shareholders 4,281,004 17.1 %
The audit has not yet been performed.
The companies included in the Group are the parent company Tulikivi Corporation, Kivia Oy, AWL-Marmori Oy and Tulikivi U.S. Inc. Group companies include also Tulikivi Vertriebs GmbH and The New Alberene Stone Company. Inc. which are dormant.
Board of directors
Distribution: Helsinki Stock Exchange Central Media
Additional information: Tulikivi Corporation, 83900 Juuka, tel. +358-13-68 11 11, www.tulikivi.com – Chairman of the Board of Directors Matti Virtaala – Managing Director Juha Sivonen
Tulikivi Corporation´s Financial Statements Release for 2004 will be published on February 7, 2005. Annual Report will come out week 11. Annual General meeting will be held on March 31, 2005.
The following interim reports will be published in 2005: – January – March April 21 – January – June July 21 – January – September October 21
Distribution
Helsinki Stock Exchange Central Media
The Tulikivi Group's profit before extraordinary items increased clearly during the report period and amounted to 3.2 (2.5) MEUR. The Group's net sales were 39.4 (38.3) MEUR. The net sales of the Fireplace Business grew by about 10 %. Earnings per share were EUR 0.25 (0.20) and equity per share was EUR 2.42 (2.84).
Net sales and result
The Tulikivi Group’s net sales in the report period were EUR 39.4 million (38.3 million January-September 2003, out of which the net sales of Kivia Oy, which was acquired in autumn 2003, account for EUR 2.2 million. The Fireplace Business generated net sales of EUR 34.7 million (31.7 million) and the Architectural Stone Business had net sales of EUR 4.7 million (6.6 million).
The share of aggregate net sales derived in Finland was EUR 20.5 million (20.8 million), or 51.9 (54.4) per cent. Exports yielded net sales of EUR 18.9 million (17.5 million). The largest countries for exports were Germany and Sweden.
The Group's profit before extraordinary items was EUR 3.2 million (2.5 million). The Fireplace Business reported profit before extraordinary items of EUR 3.3 million (3.3 million) in the period under review. The Architectural Stone Business’ result before extraordinary items turned to profit during the quarter now ended, and in cumulative terms amounted to EUR –0.1 million (-0.8 million).
Earnings per share were EUR 0.25 (0.20). The taxes included in the calculations are the taxes of the Group companies for the report period.
Financing and investments
The Group's financial position is good. Cash flow from business operations before investments was EUR 1.4 million (2.9 million). The Group’s operating capital increased by EUR 4.2 million (1.3 million) in the report period. The equity ratio was 52.6 per cent (62.3 per cent at the end of September 2003). The ratio of interest-bearing net debt to shareholders’ equity was 32.3 (8.4) per cent. The current ratio was 2.5 (2.4). Equity per share was EUR 2.42 (2.84). Financial income during the report period
2(6) amounted to EUR 0.1 million and financial expenses to EUR 0.2 million.
The Group's fixed assets investments amounted to EUR 2.6 million (2.2 million). Investments primarily comprised machinery and equipment and the opening of new quarries in Juuka and Kuhmo.
Trend in the Series A share price and share turnover
During the report period, 1,099,109 Tulikivi Corporation Series A shares were traded on Helsinki Exchanges to a total value of EUR 7.4 million. The highest trading price of the share was EUR 8.20 and the lowest EUR 5.25. The closing rate for the report period was EUR 6.50.
Own shares
The Board of Directors of Tulikivi Corporation has an authorisation from the Annual General Meeting to both buy back and transfer a maximum of 336,069 of the company’s Series A shares and a maximum of 119,250 of the company’s Series K shares.
Adoption of IFRS
The Tulikivi Group will adopt IFRS reporting from the beginning of 2005. The change in the accounting principles is not expected to have a significant effect on the balance sheet or result.
Outlook for the future
In Finland, construction of single-family houses and renovation work remain robust. Demand is good in both the Fireplace Business and the Architectural Stone Business. The Group’s net sales and earnings are developing favourably over the full year.
The order book at the close of the report period was EUR 6.3 million (6.3 million), of which the Fireplace Business accounted for EUR 5.3 million (5.3 million) and the Architectural Stone Business for EUR 1.0 million (1.0 million).
CONSOLIDATED INCOME STATEMENT MEUR 01-09/ 01-09/ Change, 01-12/ 2004 2003 % 2003 Net sales 39.4 38.3 2.9 53.6 Change in inventories of finished products 0.2 0.1 0.4 Production for own use 0.8 0.3 0.4 Other operating income 0.4 0.4 0.5
3(6) Materials and external charges 11.5 11.0 14.9
Personnel expenses 14.4 14.7 20.7 Depreciation and value adjustments 3.2 3.0 4.1 Other operating expenses 8.4 7.9 11.0
Operating profit 3.3 2.5 32.4 4.2 % of net sales 8.4 6.5 7.9
Financial income 0.1 0.2 0.1 Financial expensens 0.2 0.2
Profit before extraordinary items 3.2 2.5 26.2 4.3 % of net sales 8.0 6.6 7.9
Income taxes 0.9 0.7 1.2
Profit for the period 2.3 1.8 27.7 3.0
CONSOLIDATED BALANCE SHEET MEUR 09/2004 09/2003 12/2003 Assets Fixed assets and other non- current investments Intangible assets 3.5 3.0 3.3 Goodwill 0.4 0.7 0.6 Tangible assets Land areas 1.1 1.1 1.1 Buildings 6.2 6.9 6.4 Machinery and equipment 8.3 8.5 8.8 Other tangible assets 0.1 0.1 0.1 Investments 0.1 0.1 0.1 Fixed assets and other non-current investments total 19.7 20.4 20.4 Current assets Inventories 7.3 6.3 7.0 Long term receivables Deferred tax assets 0.6 0.7 Current receivables Trade receivables 9.6 9.1 6.6 Other current receivables 0.9 1.8 0.5 Cash in hand and at banks 3.8 4.8 6.5 Total current assets 22.2 22.0 21.3 Total assets 41.9 42.4 41.7
Liabilities and shareholders´equity Shareholders´equity Capital stock 6.2 6.2 6.2 Other shareholders´equity 15.9 19.6 18.2 Total shareholders´equity 22.1 25.8 24.4 4(6) Provisions 0.1 0.1 Liabilities Non-current liabilities
Deferred tax liabilities 0.6 0.9 0.7 Loans from credit institutions 10.3 6.4 5.0 Total non-current liabilities 10.9 7.3 5.7
Current liabilities Loans from credit institutions 0.5 0.5 2.8 Account payables 2.0 1.8 1.0 Advances received 0.1 Other current liabilities 6.3 7.0 7.6 Total current liabilities 8.8 9.3 11.5 Total liabilities and shareholders´equity 41.9 42.4 41.7
Interest bearing liabilities 10.9 7.0 7.9
CASH FLOW STATEMENT 01-09/ 01-09/ 01-12/ MEUR 2004 2003 2003 Profit before extraordinary items 3.2 2.5 4.3 Depreciation and other adjustments 3.2 2.9 4.1 Change in net working capital -4.2 -1.3 1.2 Financial items and taxes -0.8 -1.2 -1.4 Cash flow from operating activities 1.4 2.9 8.2
Investments in fixed assets -2.5 -2.2 -2.8 Proceeds from sale of fixed assets and other changes in fixed assets 0.2 Net cash used in investing activities -2.5 -2.2 -2.6
Cash flow before financing activities -1.1 0.7 5.6
Long-term borrowing 5.6 Repayment of long-term loans -2.5 -1.2 -2.1 Dividens paid -4.6 -1.9 -4.2 Net cash flow from financing activities -1.5 -3.1 -6.3
Net increase (+)/decrease(-) in cash and cash aquivalents -2.7 -2.4 -0.7
Cash equivalents at the beginning of the period 6.5 7.2 7.2 Cash equivalents at the end of the period 3.8 4.8 6.5
5(6) KEY RATIOS DESCRIBING ECONOMIC DEVELOPMENT AND KEY INDICATORS PER SHARE 09/2004 09/2003 12/2003 Order stock (30.9.), MEUR 6.3 6.3 7.2 Gross investments, MEUR 2.6 2.2 2.9 Gross investments,%/net sales 6.6 5.8 5.4 Average number of personnel 508 568 555
Earnings per share, Euro 0.25 0.20 0.34 Equity/share, Euro 2.42 2.84 2.68 Solvency ratio, % 52.6 62.3 58.7 Gearing, % 32.3 8.4 5.5 Current ratio 2.5 2.4 1.9 Average number of shares 9106385 9106385 9106385 Number of shares on Sept. 30 9106385 9106385 9106385
The number of shares for the comparison year has been multiplied by five due to the split carried out in December 2003.
CONTINGENT LIABILITIES MEUR 09/2004 09/2003 12/2003 Loans from credit institutions and other non-current liabilities for which mortgages and pledges have been given 9.7 4.7 6.0 Given mortgages and pledges 13.0 6.7 8.0 Other mortgages and pledges given on behalf of own liabilities 1.7 1.3 1.7
Environmental commitments On the basis of mining act and environmental legislation Tulikivi Corporation has landscaping commitments. The amount of the commitments can not at the time being be reliably estimated, but it is not expected to be remarkable.
Group quarterly development MEUR Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2004 2004 2003 2003 2003 2003
Net sales 13.3 12.8 13.3 15.3 13.8 12.6 11.9 Operating income 1.7 0.7 0.9 1.7 1.6 0.6 0.3 Result before taxes 1.6 0.7 0.9 1.8 1.6 0.6 0.3
6(6) Quarterly development of business areas MEUR Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2004 2004 2003 2003 2003 2003 Fireplace business Net sales 11.6 11.0 12.1 13.6 11.6 10.4 9.7 Result before extraordinary items 1.5 0.7 1.1 1.9 2.1 0.7 0.5
Architectural stone business Net sales 1.7 1.8 1.2 1.7 2.2 2.2 2.2 Result before extraordinary items 0.1 0 -0.2 -0.1 -0.5 -0.1 -0.2
LARGEST SHAREHOLDERS ON 30 SEPTEMBER 2004 Name of shareholder Number of Proportion of shares total vote Vauhkonen Reijo 1,038,977 24.4 % Vauhkonen Heikki 749,242 23.8 % Vauhkonen Eliisa 724,255 5.4 % Virtaala Matti 604,027 12.0 % Mutual Pension Insurance Company Ilmarinen 515,595 1.7 % Mutanen Susanna 449,375 7.3 % Vauhkonen Mikko 200,175 3.6 % Nuutinen Tarja 168,635 3.5 % The Finnish Cultural Foundation 110,000 1.1 % Laakkonen Reino 25,000 0.8 % Sivonen Juha 25,000 0.8 % Other shareholders 4,496,104 15.6 %
The interim report has not been audited.
The companies included in the Group are the parent company Tulikivi Corporation, Kivia Oy, Tulikivi U.S. Inc. and AWL-Marmori Oy. Group companies include also Tulikivi Vertriebs GmbH and The New Alberene Stone Company, Inc., which are dormant.
Board of directors Matti Virtaala, Chairman of the Board
Distribution: Helsinki Stock Exchange Central Media Additional information: Tulikivi Corporation, 83900 Juuka, tel., +358-13-68 11 11, www.tulikivi.com - Chairman of the Board of Directors Matti Virtaala - Managing Director Juha Sivonen
*Profit before extraordinary items and taxes improved significantly during the report period and amounted to EUR 1.6 million (EUR 0.9 million in January-June 2003). * The Group’s net sales in the report period were EUR 26.1 million (24.5 million). The net sales of the Fireplace Business grew by about 15%. * Earnings per share were EUR 0.12 (0.07) and equity per share was EUR 2.29 (2.71).
The Tulikivi Group’s net sales in the report period were EUR 26.1 million (24.5 million). The Fireplace Business generated net sales of EUR 23.1 million (20.1 million) and the Architectural Stone Business had net sales of EUR 3.0 million (4.4 million). The share of aggregate net sales derived in Finland was EUR 13.2 million (13.4 million), or 50.7 (54.8) per cent. Exports yielded net sales of EUR 12.9 million (11.1 million). The largest countries for exports were Germany and Sweden.
The Group's profit before extraordinary items was EUR 1.6 million (0.9 million). The Fireplace Business reported profit before extraordinary items of EUR 1.8 million (1.2 million). The result of the Architectural Stone Business was negative EUR 0.2 million (- 0.2 million).
Earnings per share were EUR 0.12 (0.07). The taxes included in the calculations are the taxes of the Group companies for the reported period. All deferred tax liabilities and assets have been calculated in accordance with the 26 % tax base that will come into force in 2005. The total effect on taxes of the change in the tax base has been slight.
The Group's financial position is good. Cash flow from business operations before investments was EUR 0.1 million (1.4 million). The Group’s operating capital increased by EUR 3.0 million (0.5 million) in the report period. The increase was mainly due to higher trade receivables and inventories.
The equity ratio was 49.6 per cent (60.1 per cent at the end of June 2003). The ratio of interest-bearing net debt to shareholders’ equity was 35.8 per cent (11.4). The net increase in interest-bearing liabilities during the report period was EUR 4.3
2(6) million. The current ratio was 2.2 (2.2). Financial income and expenses resulted in a net gain of just under EUR 0.1 million in the report period. Equity per share was EUR 2.29 (2.71).
The Group's fixed assets investments amounted to EUR 1.5 million (1.3 million). Investments comprised machinery and equipment and the opening of new quarries in Juuka and Kuhmo.
During the report period, 908,034 Tulikivi Corporation Series A shares were traded on Helsinki Exchanges to a total value of EUR 6.1 million. The highest trading price of the share was EUR 8.20 and the lowest EUR 5.25. The closing rate for the report period was EUR 7.00.
The order book at the close of the report period was EUR 6.7 million (7.2 million), of which the Fireplace Business accounted for EUR 4.9 million (5.3 million) and the Architectural Stone Business for EUR 1.8 million (1.9 million).
CONSOLIDATED INCOME STATEMENT MEUR 01-06/ 01-06/ Change, 01-12/ 2004 2003 % 2003 Net sales 26.1 24.5 6,6 53.6 Change in inventories of finished products 1.1 0.5 0.4 Production for own use 0.5 0.1 0.4 Other operating income 0.3 0.2 0.5
Materials and external charges 8.0 7.4 14.9 3(6) Personnel expenses 10.2 9.7 20.7 Depreciation and value adjustments 2.1 1.9 4.1 Other operating expenses 6.1 5.4 11.0
Operating profit 1.6 0.9 71.6 4.2 % of net sales 6.1 3.8 7.9
Financial income and expensens . . 0.1
Profit before extraordinary items 1.6 0.9 76.6 4.3 % of net sales 6.0 3.6 7.9
Income taxes 0.5 0.3 1.2
Profit for the period 1.1 0.6 68.9 3.0
CONSOLIDATED BALANCE SHEET MEUR 06/2004 06/2003 12/2003 Assets Fixed assets and other non- current investments Intangible assets 3.5 3.0 3.3 Goodwill 0.5 0.9 0.6 Tangible assets Land areas 1.1 1.1 1.1 Buildings 6.1 7.0 6.4 Machinery and equipment 8.4 8.4 8.8 Other tangible assets 0.1 0.1 0.1 Investments 0.1 0.1 0.1 Fixed assets and other non-current investments total 19.8 20.6 20.4 Current assets Inventories 8.1 6.8 7.0 Long term receivables Deferred tax assets 0.6 0.7 Current receivables Trade receivables 7.6 7.1 6.6 Other current receivables 1.4 2.4 0.5 Cash in hand and at banks 4.6 4.8 6.5 Total current assets 22.3 21.1 21.3 Total assets 42.1 41.7 41.7
Liabilities and shareholders´equity Shareholders´equity Capital stock 6.2 6.2 6.2 Other shareholders´equity 14.7 18.5 18.2 Total shareholders´equity 20.9 24.7 24.4 Provisions 0.1 0.1 Liabilities Non-current liabilities 4(6) Deferred tax liabilities 0.6 0.9 0.7 Loans from credit institutions 10.6 6.4 5.0 Other non-current liabilities 0.1 Total non-current liabilities 11.2 7.4 5.7
Current liabilities Loans from credit institutions 1.4 1.2 2.8 Account payables 2.2 1.9 1.0 Advances received 0.1 0.7 0.1 Other current liabilities 6.2 5.8 7.6 Total current liabilities 9.9 9.6 11.5 Total liabilities and shareholders´equity 42.1 41.7 41.7
Interest bearing liabilities 12.1 7.6 7.9
CASH FLOW STATEMENT 01-06/ 01-06/ 01-12/ MEUR 2004 2003 2003 Profit before extraordinary items 1.6 0.9 4.3 Depreciation and other adjustments 2.1 1.9 4.1 Change in net working capital -3.0 -0.5 1.2 Financial items and taxes -0.7 -0.9 -1.4 Cash flow from operating activities 0.1 1.4 8.2
Investments in fixed assets -1.5 -1.3 -2.8 Proceeds from sale of fixed assets and other changes in fixed assets -0.1 0.2 Net cash used in investing activities -1.6 -1.3 -2.6
Cash flow before financing activities -1.5 0.1 5.6
Long-term borrowing 5.6 Repayment of long-term loans -1.4 -0.7 -2.1 Dividens paid -4.6 -1.9 -4.2 Net cash flow from financing activities -0.4 -2.6 -6.3
Net increase (+)/decrease(-) in cash and cash aquivalents -1.9 -2.5 -0.7
Cash equivalents at the beginning of the period 6.5 7.2 7.2 Cash equivalents at the end of the period 4.6 4.7 6.5
5(6) KEY RATIOS DESCRIBING ECONOMIC DEVELOPMENT AND KEY INDICATORS PER SHARE
06/2004 06/2003 12/2003 Order stock (30.6), MEUR 6.7 7.2 7.2 Gross investments, MEUR 1.5 1.3 2.9 Gross investments,%/net sales 5.7 5.3 5.4 Average number of personnel 542 537 555
Earnings per share, Euro 0.12 0.07 0.34 Equity/share, Euro 2.29 2.71 2.68 Solvency ratio, % 49.6 60.1 58.7 Gearing, % 35.8 11.4 5.5 Current ratio 2.2 2.2 1.9 Average number of shares 9106385 9106385 9106385 Number of shares on June 30 9106385 9106385 9106385
CONTINGENT LIABILITIES MEUR 06/2004 06/2003 12/2003 Loans from credit institutions and other non-current liabilities for which mortgages and pledges have been given 10.6 5.1 6.0 Given mortgages and pledges 13.4 6.7 8.0 Other mortgages and pledges given on behalf of own liabilities 1.7 1.3 1.7
Group quarterly development MEUR Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2004 2003 2003 2003 2003
Net sales 12.8 13.3 15.3 13.8 12.6 11.9 Operating income 0.7 0.9 1.7 1.6 0.6 0.3 Result before taxes 0.7 0.9 1.8 1.6 0.6 0.3 6(6) Quarterly development of business areas MEUR Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2004 2003 2003 2003 2003 Fireplace business Net sales 11.0 12.1 13.6 11.6 10.4 9.7 Result before extraordinary items 0.7 1.1 1.9 2.1 0.7 0.5
Architectural stone business Net sales 1.8 1.2 1.7 2.2 2.2 2.2 Result before extraordinary items 0 -0.2 -0.1 -0.5 -0.1 -0.2
LARGEST SHAREHOLDERS ON 30 JUNE 2004 Name of shareholder Number of Proportion of shares total vote
Vauhkonen Reijo 1,038,977 24.4 % Vauhkonen Heikki 749,242 23.8 % Vauhkonen Eliisa 724,255 5.4 % Virtaala Matti 604,027 12.0 % Mutual Pension Insurance Company Ilmarinen 515,595 1.7 % Mutanen Susanna 449,375 7.3 % Vauhkonen Mikko 200,175 3.6 % Nuutinen Tarja 168,635 3.5 % The Finnish Cultural Foundation 110,000 1.1 % Juha Sivonen 25,000 0,8 % Other shareholders 4,521,104 16.4 %
Additional information: Tulikivi Corporation, 83900 Juuka, tel., +358-13-68 11 11, www.tulikivi.com - Chairman of the Board of Directors Matti Virtaala - Managing Director Juha Sivonen GIVEN GUARANTEES, CONTINGENT LIABILITIES AND OTHER COMMITMENTS ME 03/2004 03/2003 12/2003 Loans from credit institutions and other non-current liabilities for which mortgages have been given 5.6 5.2 6.0 Given mortgages 8.0 6.7 8.0 Other mortgages and pledges given on behalf of own liabilities 1.7 1.3 1.7
Environmental commitments On the basis of mining act and environmental legislation Tulikivi Corporation has landscaping commitments. The amount of the commitments can not at the time being be reliably estimated.
Group quarterly development EUR million Q1/ Q4/ Q3/ Q2/ Q1/ 2004 2003 2003 2003 2003
Net sales 13.3 15.3 13.8 12.6 11.9 Operating income 0.9 1.7 1.6 0.6 0.3 Result before taxes 0.9 1.8 1.6 0.6 0.3
Quarterly development of business areas EUR million Q3/ Q4/ Q3/ Q2/ Q1/ 2004 2003 2003 2003 2003 Fireplace business Net sales 12.1 13.6 11.6 10.4 9.7 Result before extraordinary items 1.1 1.9 2.1 0.7 0.5 Architectural stone business Net sales 1.2 1.7 2.2 2.2 2.2 Result before extraordinary items -0.2 -0.1 -0.5 -0.1 -0.2
LARGEST SHAREHOLDERS ON 31 MARCH 2004 Name of shareholder Number of Portion of shares total vote
Vauhkonen Reijo 1,038,365 24.4 % Vauhkonen Heikki 748,630 23.8 % Vauhkonen Eliisa 724,755 5.4 % Virtaala Matti 603,415 12.0 % Mutual Pension Insurance Company Ilmarinen 515,595 1.7 % 7(7) Mutanen Susanna 449,375 7.3 % Vauhkonen Mikko 200,175 3.6 % Nuutinen Tarja 168,635 3.5 % Investments fund Phoebus 197,500 0.6 % Fondita Nordic Small Cap Placfond 168,100 0.5 % Other shareholders 4,291,840 17,2 %
The companies included in the Group are the parent company Tulikivi Corporation, Kivia Oy, Tulikivi U.S. Inc. and AWL- Marmori. Group companies include also Tulikivi Vertriebs GmbH and The New Alberene Stone Company, Inc., which are dormant.
Additional information: Tulikivi Corporation, 83900 Juuka, tel., +358-13-68 11 11, www.tulikivi.com - Chairman of the Board of Directors Matti Virtaala - Managing Director Juha Sivonen
The Tulikivi Group’s net sales in the report period grew by 12.5 % to EUR 13.3 million (11.9 million in January-March 2003). Profit before extraordinary items and taxes increased and was EUR 0.9 million (0.3 million). Earnings per share were EUR 0.07 (0.02) and equity per share was EUR 2.24 (2.66).
The Tulikivi Group’s net sales in the report period were EUR 13.3 million (11.9 million). The Fireplace Business generated net sales of EUR 12.1 million (9.7 million) and the Architectural Stone Business had net sales of EUR 1.2 million (2.2 million). The share of aggregate net sales derived in Finland was EUR 6.9 million (6.9 million), or 51.7 (58.3) per cent. Exports yielded total net sales of EUR 6.4 million (5.0 million). The largest countries for exports were Germany and Sweden.
The Group's profit before extraordinary items was EUR 0.9 million (0.3 million). The improvement in earnings was due not only to the growth in net sales but also to the restructuring measures that were carried out in 2003. The Fireplace Business reported profit before extraordinary items of EUR 1.1 million (0.5 million). The result of the Architectural Stone Business was negative EUR 0.2 million (-0.2 million). Kivia Oy, which was acquired in autumn 2003, had net sales in the report period of EUR 0.7 million and a positive result.
Earnings per share were EUR 0.07 (0.02). As income taxes have been reported taxes relating to the group companies profit for the report period.
The Group's financial position is good. Cash flow from business operations before investments was EUR 1.6 million negative (0.6 million). The Group’s net working capital increased by EUR 3.4 million (0.3 million) in the report period. The increase was due to higher trade receivables, prepayments and inventories. The equity ratio was 48.4 per cent (55.6 per cent at the end of March 2003). The dividend to be paid for the previous year has been subtracted from shareholders’ equity and it is stated as a corresponding increase in other current liabilities. The ratio of interest-bearing net debt to shareholders’ equity, or gearing, was 18.1 per cent (3.3). The current ratio was 1.4 (1.9). Financial income and expenses resulted in a net gain of just under EUR 0.1 million in the report period.
2(7) Equity per share was EUR 2.24 (2.66).
The Group's fixed assets investments amounted to EUR 0.7 million (0.4 million). Investments consisted mainly of equipment and software and opening of new quarries in Juuka and Kuhmo.
Price development and trade volume of A-share
During the report period, 608,582 Tulikivi Corporation A-shares were traded on Helsinki Exchanges to a total value of EUR 3.9 million. The highest trading price of the share was EUR 8.02 and the lowest EUR 5.25. The closing rate for the report period was EUR 7.55.
Resolutions of the Annual General Meeting
Dividend distribution and administrative bodies
The Annual General Meeting of Tulikivi Corporation on 20 April 2004 resolved to pay a dividend, in accordance with the Board of Directors’ proposal, of EUR 0.51 on A-shares and EUR 0.50 on K- shares, or a total of EUR 4.6 million.
The following members were elected to the Board of Directors of the parent company and the operating subsidiaries: Bishop Ambrosius, Juhani Erma, Eero Makkonen, Aimo Paukkonen, Heikki Vauhkonen, Reijo Vauhkonen and Matti Virtaala. From amongst its members, the Board of Directors elected Matti Virtaala chairman and Reijo Vauhkonen vice chairman. Authorized Public Accountants PricewaterhouseCoopers Oy of Helsinki were elected the company’s auditor.
Authorization to buy back and transfer the company’s own shares
The Annual General Meeting granted the Board of Directors an authorization to buy back the company’s own shares (treasury shares). The treasury shares will be purchased with the aim of developing the company’s capital structure and for use as consideration in acquisitions or other structural arrangements in the manner and to the extent decided by the Board of Directors. Similarly, the Annual General Meeting granted the Board of Directors an authorization to transfer the treasury shares. The shares can be transferred as consideration in acquisitions or they can be used in other structural arrangements in the manner and to the extent decided by the Board of Directors. The Board of Directors can also decide to sell A-shares in public trading on Helsinki Exchanges in order to obtain funds for possible acquisitions or to finance capital expenditures. The Board of Directors can furthermore propose that the shares be cancelled by lowering the share capital. No more than a total of 336,069 A- 3(7) shares and no more than a total of 119,250 K-shares will be bought back. The company’s A-shares will be purchased in public trading on Helsinki Exchanges and the K-shares as a rule by making a tender offer to Series K shareholders in proportion to their holdings.
In Finland, construction of single-family houses and renovation work will remain robust. In Continental Europe the upswing in the business cycle will unfold more slowly than was previously anticipated. All in all, demand for Tulikivi’s products is expected to be good. The Group’s net sales and earnings are set to develop favourably over the full year.
The order stock at the end of the report period was EUR 6.9 million (6.9 million), of which the Fireplace Business accounted for EUR 5.2 million (5.1 million) and the Architectural Stone Business for EUR 1.7 million (1.8 million).
CONSOLIDATED INCOME STATEMENT ME 01-03/ 01-03/ Change, 01-12/ 2004 2003 % 2003 Net sales 13.3 11.9 12.5 53.6 Change in inventories of finished products 0.2 0.1 0.4 Production for own use 0.3 0.4 Other operating income 0.2 0.1 0.5
Materials and external charges 4.2 3.6 14.9 Personnel expenses 5.1 4.6 20.9 Depreciation and value adjustments 1.0 0.9 4.1 Other operating expenses 2.8 2.7 10.8
Operating profit 0.9 0.3 235.9 4.2 % of net sales 7.1 2.4 7.9
Profit before extraordinary items 0.9 0.3 264.1 4.3 % of net sales 6.8 2.1 7.9
Income taxes 0.3 0.1 1.2
Profit for the period 0.6 0.2 207.9 3.0
4(7) CONSOLIDATED BALANCE SHEET ME 03/2004 03/2003 12/2003 Assets Fixed assets and other non- current investments Intangible assets 3.4 2.8 3.3 Goodwill 0.6 1.0 0.6 Tangible assets Land areas 1.1 1.1 1.1 Buildings 6.2 7.1 6.4 Machinery and equipment 8.5 8.4 8.8 Other tangible assets 0.2 0.1 0.1 Investments 0.1 0.1 0.1 Fixed assets and other non-current investments total 20.1 20.6 20.4 Current assets Inventories 7.3 6.5 6.9 Long term receivables Deferred tax assets 0.7 0.7 Current receivables Trade receivables 8.7 7.9 6.6 Other current receivables 2.0 1.9 0.6 Cash in hand and at banks 3.4 7.2 6.5 Total current assets 22.1 23.5 21.3 Total assets 42.2 44.1 41.7
Liabilities and shareholders´equity Shareholders´equity Capital stock 6.2 6.2 6.2 Other shareholders´equity 14.2 18.1 18.2 Total shareholders´equity 20.4 24.3 24.4 Provisions 0.1 0.1 Liabilities Non-current liabilities Deferred tax liabilities 0.7 0.9 0.7 Loans from credit institutions 5.0 6.4 5.0 Other non-current liabilities 0.1 Total non-current liabilities 5.7 7.4 5.7 Current liabilities Loans from credit institutions 2.0 1.6 2.8 Account payables 1.9 2.2 1.0 Other current liabilities 12.1 8.6 7.7 Total current liabilities 16.0 12.4 11.5 Total liabilities and shareholders´equity 42.2 44.1 41.7
Interest bearing liabilities 7.1 8.0 7.8
5(7) CASH FLOW STATEMENT 01-03/ 01-03/ 01-12/ ME 2004 2003 2003 Profit before extraordinary items 0.9 0.3 4.3 Depreciation and other adjustments 1.1 0.9 4.1 Change in net working capital -3.4 -0.3 1.2 Financial items and taxes -0.2 -0.3 -1.4 Cash flow from operating activities -1.6 0.6 8.2
Investments in fixed assets -0.7 -0.4 -2.8 Proceeds from sale of fixed assets and other changes in fixed assets . 0.2 Net cash used in investing activities -0.7 -0.4 -2.6
Cash flow before financing activities -2.3 0.2 5.6
Repayment of long-term loans -0.8 -0.2 -2.1 Dividens paid -4.2 Net cash flow from financing activities -0.8 -0.2 -6.3
Net increase (+)/decrease(-) in cash and cash aquivalents -3.1 0 -0.7
Cash equivalents at the beginning of the period 6.5 7.2 7.2 Cash equivalents at the end of the period 3.4 7.2 6.5
KEY RATIOS DESCRIBING ECONOMIC DEVELOPMENT AND KEY INDICATORS PER SHARE 03/2004 03/2003 12/2003 Order stock (31.3), ME 6.9 6.9 7.2 Gross investments, ME 0.7 0.4 2.9 Gross investments,%/net sales 5.1 3.4 5.4 Average number of personnel 545 517 555 Average number of personnel at the end of period 541 540 562 Earnings per share, Euro 0.07 0.02 0.34 Equity/share, Euro 2.24 2.66 2.68 Solvency ratio, % 48.4 55.6 58.7 Gearing, % 18.1 3.3 5.5 Current ratio 1.4 1.9 1.9 Average number of shares 9106385 9106385 9106385 Number of shares at the end of period 9106385 9106385 9106385
6(7) GIVEN GUARANTEES, CONTINGENT LIABILITIES AND OTHER COMMITMENTS ME 03/2004 03/2003 12/2003 Loans from credit institutions and other non-current liabilities for which mortgages have been given 5.6 5.2 6.0 Given mortgages 8.0 6.7 8.0 Other mortgages and pledges given on behalf of own liabilities 1.7 1.3 1.7
* In the Nunnanlahti district of Juuka, Tulikivi Corporation has found a major new deposit of soapstone. * Thanks to the deposit, the company now possesses soapstone reserves for about 65 years.
The new deposit of soapstone found in Juuka is of good quality and is suitable for present products and new products that are in the planning stage. The estimated extent of the deposit is 2,000,000 cross cubic metres and it is Tulikivi Corporation’s most important find in Nunnanlahti for 15 years. Work on ascertaining the quality and extent of the deposit is continuing.
Tulikivi Corporation’s strategic objective is for the company continually to have soapstone reserves that will suffice for over 50 years. Tulikivi Corporation now possesses soapstone reserves for about 65 years. The adequacy of the stone supply is measured in years of use at the present volume. Ensuring a sufficient supply of raw material depends not only on the continuous exploration of new deposits but also on the precise use of stone and development projects connected with it.
The exploration of stone reserves is a long-term and ongoing operation. Tulikivi Corporation invests over 500,000 euros a year on exploratory drillings and test quarrying. Each year the company conducts 3-6 kilometres of drillings in different areas in Juuka, Kuhmo and Suomussalmi. Apart from the investments, use of the stone is enhanced through continuous development of products and production technology.
Additional information: – Tulikivi Corporation, 83900 Juuka, tel. +358-13-681 111, www.tulikivi.com – Matti Virtaala, Chairman of the Board – Juha Sivonen, Managing Director
Distribution: – Helsinki Exchanges, – Central media