Aspo Group Interim Financial Report, January 1 to September 30,
2023: Aspo’s Q3 results improved considerably from Q2, yet not
reaching previous year’s record level
Aspo Plc Interim financial
report
November 1, 2023, at 9:30 amAspo Group Interim Financial
Report, January 1 to September 30, 2023
Aspo’s Q3 results improved considerably from Q2, yet not
reaching previous year’s record level
Figures from the corresponding period in 2022 are presented in
brackets. From the beginning of year 2023, Aspo established a new
segment structure and the figures for the comparative periods have
been restated.
July–September 2023
- Continuing operations
- Net sales from continuing operations
decreased to EUR 130.0 (142.8) million.
- Comparable operating from continuing
operations profit was EUR 7.4 (12.4) million, and the comparable
operating profit rate of continuing operations was 5.7% (8.7%).
Comparable operating profit of ESL Shipping was EUR 4.0 (9.8)
million, Telko EUR 3.1 (3.1) million, and Leipurin EUR 1.3 (0.5)
million.
- Operating profit from continuing
operations was EUR 8.1 (11.8) million, and the operating profit
rate of continuing operations was 6.2% (8.3%). Operating profit of
ESL Shipping was EUR 4.0 (9.8) million, Telko EUR 3.1 (3.6)
million, and Leipurin EUR 2.0 (-0.5) million.
- Group total level
- Net sales, Group total decreased to
EUR 133.3 (160.0) million.
- Comparable operating profit at Group
total level was EUR 7.9 (13.0) million, and the comparable
operating profit rate was 5.9% (8.1%).
- Items affecting the comparability of
operating profit totaled EUR -1.3 (-0.7) million at Group total
level.
- Earnings per share were EUR 0.10
(0.30).
- Net cash from operating activities
was EUR 16.3 (11.4) million. Free cash flow was EUR 12.0 (-9.7)
million.
January–September 2023
- Continuing operations
- Net sales from continuing operations
decreased to EUR 404.2 (407.8) million.
- Comparable operating profit from
continuing operations was EUR 19.4 (32.8) million, and the
comparable operating profit rate of continuing operations was 4.8%
(8.0%). Comparable operating profit of ESL Shipping was EUR 13.3
(26.9) million, Telko EUR 6.7 (9.6) million, and Leipurin EUR 3.4
(0.6) million.
- Operating profit from continuing
operations was EUR 19.5 (27.5) million, and the operating profit
rate of continuing operations was 4.8% (6.7%). Operating profit of
ESL Shipping was EUR 13.3 (28.0) million, Telko EUR 5.7 (6.0)
million, and Leipurin EUR 4.6 (-1.6) million.
- Group total level
- Net sales, Group total decreased to
EUR 417.2 (487.9) million.
- Comparable operating profit at Group
total level was EUR 19.5 (44.0) million, and the comparable
operating profit rate was 4.7% (9.0%).
- Items affecting the comparability of
operating profit totaled EUR -9.6 (-8.0) million at Group total
level.
- Earnings per share were EUR 0.12
(0.82).
- Net cash from operating activities
was EUR 35.0 (45.7) million. Free cash flow was EUR 27.0 (17.9)
million.
Specified guidance for 2023
Aspo Group’s comparable operating profit will be EUR 25–30
million in 2023 (2022: EUR 55.3 million).
Previous guidance for 2023 (issued on May 12, 2023): Aspo
Group’s comparable operating profit will be EUR 25-35 million in
2023 (2022: EUR 55.3 million).
Key
figures |
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
|
|
|
|
|
Net sales,
Group total, MEUR |
133.3 |
160.0 |
417.2 |
487.9 |
652.6 |
Net sales from
continuing operations, MEUR |
130.0 |
142.8 |
404.2 |
407.8 |
560.7 |
|
|
|
|
|
|
ESL Shipping,
comparable operating profit, MEUR |
4.0 |
9.8 |
13.3 |
26.9 |
37.4 |
Telko,
comparable operating profit, MEUR |
3.1 |
3.1 |
6.7 |
9.6 |
11.3 |
Leipurin,
comparable operating profit, MEUR |
1.3 |
0.5 |
3.4 |
0.6 |
1.1 |
Other
operations, comparable operating profit, MEUR |
-1.0 |
-1.0 |
-4.0 |
-4.3 |
-5.9 |
Comparable
operating profit from continuing operations, MEUR |
7.4 |
12.4 |
19.4 |
32.8 |
43.9 |
Comparable
operating profit from continuing operations, % |
5.7 |
8.7 |
4.8 |
8.0 |
7.8 |
Comparable
operating profit from discontinued operations, MEUR |
0.5 |
0.6 |
0.1 |
11.2 |
11.4 |
Comparable
operating profit, Group total, MEUR |
7.9 |
13.0 |
19.5 |
44.0 |
55.3 |
Comparable
operating profit, Group total, % |
5.9 |
8.1 |
4.7 |
9.0 |
8.5 |
Items
affecting comparability, Group total, MEUR |
-1.3 |
-0.7 |
-9.6 |
-8.0 |
-24.1 |
Operating
profit, Group total, MEUR |
6.6 |
12.3 |
9.9 |
36.0 |
31.2 |
|
|
|
|
|
|
Profit before
taxes from continuing operations, MEUR |
5.6 |
9.9 |
12.9 |
23.5 |
32.5 |
Profit for the
period, MEUR |
3.9 |
9.4 |
5.4 |
26.1 |
20.7 |
Profit from
continuing operations, MEUR |
5.3 |
9.2 |
13.2 |
22.1 |
30.8 |
Profit from
discontinued operations, MEUR |
-1.4 |
0.2 |
-7.8 |
4.0 |
-10.1 |
Earnings per
share (EPS), EUR |
0.10 |
0.30 |
0.12 |
0.82 |
0.61 |
EPS from
continuing operations, EUR |
0.15 |
0.30 |
0.37 |
0.70 |
0.93 |
EPS from
discontinued operations, EUR |
-0.05 |
0.00 |
-0.25 |
0.12 |
-0.32 |
Net cash from
operating activities, MEUR |
16.3 |
11.4 |
35.0 |
45.7 |
67.7 |
Free cash
flow, MEUR |
12.0 |
-9.7 |
27.0 |
17.9 |
34.4 |
Return on
equity (ROE), % |
|
|
4.9 |
23.7 |
15.2 |
Equity ratio,
% |
|
|
35.8 |
35.8 |
34.7 |
Gearing,
% |
|
|
104.5 |
97.6 |
108.4 |
Equity per
share, EUR |
|
|
4.67 |
5.24 |
4.58 |
Rolf Jansson, CEO of Aspo Group, comments on the third
quarter of 2023:
Aspo’s profitability improved significantly in the third quarter
of 2023, which was aligned with expectations and driven by the
improved performance of all businesses. The comparable operating
profit from continuing operations was EUR 7.4 (12.4) million,
clearly above the previous quarter EUR 3.6 million. The
profitability of all businesses showed positive development, and
strong operating cash flow. The third quarter result is a
demonstration of a resilient business portfolio.
During the third quarter, ESL Shipping’s volumes picked up after
the summer, and the company succeeded well in optimizing
transportation flows and capacity utilization. Telko’s performance
improvement during the third quarter was based on positive market
share development combined with stabilizing market prices,
especially in plastics. Leipurin was able to deliver further
evidence that management is successfully implementing actions for
growth and profitability improvement.
The comparable operating profit for January–September 2023, at
Group total level was EUR 19.5 (44.0) million, and the operating
profit rate was 4.7% (9.0%). Based on this financial performance
and current market visibility, we specified our guidance for Aspo
Group’s full year 2023 comparable operating profit to EUR 25-30
million. Key short term profitability drivers include volume
development of key customers of ESL, market price development of
key product lines of Telko and Leipurin, and successful
implementation of development efforts across all businesses.
The strategies of Aspo’s businesses remain solid. ESL Shipping’s
ambition is to offer its key customers environmentally friendly and
eventually fossil free sea transportation. The market is very
attractive as a consequence of the green transitions of Nordic
industrial production. As communicated before, we are investigating
different alternative measures to finance this growth, including a
launch of a new investment pool of green vessels, a possible equity
injection in ESL Shipping by a minority shareholder, and the sale
of the two Supramax vessels. The first results of this program are
expected still during year 2023.
Telko is pursuing organic growth, based on the growth in the
underlying market as well as through gaining market share. Telko is
also very actively pursuing acquisitions, both synergistic add-ons
as well as new growth platforms. We remain confident that the wide
efforts will generate results, scaling-up Telko’s business with new
carefully selected businesses of high quality. All acquisitions so
far have successfully been implemented, generating financial
performance aligned with or above expectations.
Leipurin’s full profit potential program is progressing as
planned, with significant profit improvement compared with last
year. The integration of Kobia is progressing well and the
acquisition has proven to be a game changer for Leipurin,
strategically serving principals and customers in the Nordics. The
divestment of bakery equipment trading business and sale and lease
back of Lithuanian property both support Leipurin’s strategy to be
a focused, Nordic ingredient and service company. The path for
growth as well as performance improvement remains clear.
As announced earlier, I am delighted to welcome Erkka Repo as
Aspo Group’s Chief Financial Officer and member of Aspo’s Group
Executive Committee. Repo will start in his position during
February 2024.
ASPO GROUP
Financial results and targets
Aspo's long-term financial targets are:
- Annual increase in net sales: 5–10%
a year
- Operating profit: 8%
- Return on equity: more than 20%
- Gearing: less than 130%
On a business level, ESL Shipping’s operating profit target is
14%, Telko’s 8% and Leipurin’s 5%. The operating profit rate
targets are evaluated against the comparable operating profit rate
of Aspo Group and its businesses.
In the third quarter of 2023, Aspo’s net sales from continuing
operations decreased by 9% to EUR 130.0 (142.8) million. The
comparable operating profit rate of the continuing operations was
5.7% (8.7%). Return on equity was 4.9% (23.7%). ROE was on a modest
level especially due to the loss from discontinued operations
resulting mainly from the reclassification of translation
differences of sold and discontinued entities with no impact on
Group total equity. Return on equity adjusted for items affecting
comparability was 13.6% (30.1%). Gearing stood at 104.5% (12/2022:
108.4%), well below the target level.
To provide a more transparent and clear view of its businesses
and financial results, Aspo established a new reportable segment
called Non-core businesses in the beginning of year 2023 which is
reported as a discontinued operation. In the comparative periods of
2022, the result of the discontinued operations also includes the
operative result and divestment loss of Kauko Oy, which was
divested on October 31, 2022. Thus, the results of Kauko and the
Non-core businesses segment, which make up the result of the
discontinued operations, are presented separately from the results
of Aspo Group’s continuing operations, but the result of the
discontinued operations is included in the presented “Group total”
figures including the measure comparable operating profit, Group
total.
Aspo Group’s comparable operating profit includes results for
continuing and discontinued operations. The comparable operating
profit is calculated by adjusting the reported operating profit
with rare and material items affecting the operating profit. These
may include impairment losses, sales gains and losses from divested
businesses and non-current assets, as well as financial losses
caused by Russia’s invasion in Ukraine.
Net sales and operating profit rate, Group
total |
|
|
|
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
Net sales,
Group total |
133.3 |
160.0 |
417.2 |
487.9 |
652.6 |
Net sales,
continuing operations |
130.0 |
142.8 |
404.2 |
407.8 |
560.7 |
Net sales,
discontinued operations |
3.3 |
17.2 |
13.0 |
80.1 |
91.9 |
Operating
profit, Group total |
6.6 |
12.3 |
9.9 |
36.0 |
31.2 |
Operating
profit, Group total, % |
5.0 |
7.7 |
2.4 |
7.4 |
4.8 |
Items
affecting comparability |
-1.3 |
-0.7 |
-9.6 |
-8.0 |
-24.1 |
Comparable
operating profit, Group total |
7.9 |
13.0 |
19.5 |
44.0 |
55.3 |
Comparable
operating profit, Group total, % |
5.9 |
8.1 |
4.7 |
9.0 |
8.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit and comparable operating profit, Group
total |
|
|
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
ESL Shipping,
operating profit |
4.0 |
9.8 |
13.3 |
28.0 |
38.2 |
Telko,
operating profit |
3.1 |
3.6 |
5.7 |
6.0 |
8.2 |
Leipurin,
operating profit |
2.0 |
-0.5 |
4.6 |
-1.6 |
-1.4 |
Other
operations, operating profit |
-1.0 |
-1.1 |
-4.1 |
-4.9 |
-6.6 |
Operating
profit from continuing operations |
8.1 |
11.8 |
19.5 |
27.5 |
38.4 |
Operating
profit from discontinued operations |
-1.5 |
0.5 |
-9.6 |
8.5 |
-7.2 |
Operating
profit, Group total |
6.6 |
12.3 |
9.9 |
36.0 |
31.2 |
Items
affecting comparability |
-1.3 |
-0.7 |
-9.6 |
-8.0 |
-24.1 |
Comparable
operating profit, Group total |
7.9 |
13.0 |
19.5 |
44.0 |
55.3 |
Items
affecting comparability, Group total |
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
ESL
Shipping |
|
0.0 |
0.0 |
1.1 |
0.8 |
Telko |
|
0.5 |
-1.0 |
-3.6 |
-3.1 |
Leipurin |
0.7 |
-1.0 |
1.2 |
-2.2 |
-2.5 |
Other
operations |
|
-0.1 |
-0.1 |
-0.6 |
-0.7 |
Continuing operations, total |
0.7 |
-0.6 |
0.1 |
-5.3 |
-5.5 |
Discontinued
operations |
-2.0 |
-0.1 |
-9.7 |
-2.7 |
-18.6 |
Total |
-1.3 |
-0.7 |
-9.6 |
-8.0 |
-24.1 |
In the third quarter of 2023, items affecting comparability were
EUR -1.3 million in total. EUR 0.7 million reported in the Leipurin
segment consisted of EUR 0.9 million from the gain on the sale and
lease back transaction of office and warehouse premises in
Lithuania and EUR -0.2 million was caused by restructuring
activities in Sweden. Items of EUR -2.0 million reported for
discontinued operations consisted of EUR -1.0 million relating to
the discontinuation of Telko Belarus, EUR -0.7 million relating to
the divestment of Telko Russia and EUR -0.3 million relating to
fair value adjustments of the entities held for sale.
In the third quarter of 2022, items affecting comparability
amounted to EUR -0.7 million in total. EUR 0.5 million reported in
the Telko segment was an adjustment to the bad debt allowance in
Ukraine. EUR -1.0 million reported for Leipurin arose from the
acquisition of Kobia AB. EUR -0.1 million reported in other
operations related to corporate restructuring costs. EUR -0.1
million reported in discontinued operations included costs related
to restructuring of Russia-related operations in the Non-core
businesses segment.
In January-September 2023 the items affecting comparability
amounted to EUR -9.6 million in total. EUR -1.0 million reported in
the Telko segment related to inventory write downs caused by
Russia’s invasion in Ukraine. EUR 1.2 million reported in the
Leipurin segment consisted of EUR 1.4 million from gains on sale
and lease back transactions of properties in Sweden and premises in
Lithuania and of EUR -0.2 million from restructuring activities in
Sweden. EUR -0.1 million reported in other operations related to
corporate restructuring costs. EUR -9.7 million reported in
discontinued operations consisted of the divestment loss of Telko
Russia EUR -8.1 million, the write down of Telko Russia’s inventory
EUR -1.7 million, a loss of EUR -0.8 million for the
discontinuation of Telko’s subsidiary in Belarus, and EUR 0.9
million of valuation adjustments relating to the other eastern
businesses held for sale.
The items affecting comparability in January-September 2022
amounted to EUR -8.0 million in total. For ESL Shipping the total
amount of EUR 1.1 million consisted of EUR 1.5 million in sales
gains from ESL Shipping’s barge Espa, and cost provisions of EUR
-0.4 million related to the war in Ukraine. For Telko the total
amount of EUR -3.6 million consisted of EUR -2.6 million in losses
from the destruction of Telko’s warehouse in Ukraine, and a credit
loss provision of EUR -1.0 million associated with Telko’s accounts
receivables in Ukraine. EUR -2.2 million reported in the Leipurin
segment consisted of EUR -0.7 million in losses from the
destruction of Leipurin’s warehouse in Ukraine, a credit loss
provision of EUR -0.1 million associated with Leipurin’s accounts
receivable in Ukraine, EUR -0.4 million divestment loss of
Vulganus, and EUR -1.0 million from the acquisition of Kobia AB.
EUR -0.6 million reported in Other operations related to corporate
restructuring costs and share-based payments granted to Aspo’s
previous CEO. In discontinued operations the amount of EUR -2.7
million consisted of EUR -1.5 million of restructuring costs of
Russia-related operations in the Non-core businesses segment and
EUR -1.3 million of impairment loss on Kauko’s goodwill.
In 2022, items affecting comparability totaled EUR -24.1
million, of which EUR -20.7 million resulted from the impact of
Russia’s invasion in Ukraine on Aspo Group’s business operations.
Items affecting comparability relating to the Kauko segment totaled
EUR -2.5 million. Other items affecting comparability totaled EUR
-0.9 million.
Sustainability
Sustainability is key driver for Aspo’s management system and
especially for the company’s investments. Aspo’s businesses aim to
be forerunners in sustainability in their respective sectors. The
key target is to reduce emission intensity, CO2 (tn) per net sales
(EUR thousand), by 30% by 2025. The starting point (2020) was 0.44,
while the target level (2025) is 0.30. According to the green
transition in the shipping industry, ESL Shipping is engaged in
close and long-term cooperation with leading energy suppliers to
provide fossil-free sea transportation for its key customers in the
future. ESL Shipping is investing in twelve new generation electric
hybrid vessels, half of which will remain in its own ownership and
half will be transferred to the other party of the pooling
arrangement. The investment is instrumental in the company’s green
transition.
During the past 12 months, emission intensity has slightly
increased despite the positive development in operational
efficiency and the use of new operating models especially by ESL
Shipping, standing at 0.35 (0.33 for the full-year 2022). The
slight increase is driven by decrease in net sales, partly driven
by lowering fuel prices, as the emissions during the past 12 months
have decreased in absolute terms. Specifically for ESL Shipping,
emission intensity was impacted also by fleet structure and the
difficult ice conditions in the Northern Bay of Bothnia during
April. The emission intensity target for the full-year 2023 is
0.36.
Another key sustainability focus area of Aspo is employee
safety. The rolling 12 months Total Recordable Injury Frequency
(TRIF) improved and was 7.8 (8.1 for the full-year 2022). The TRIF
target for 2023 is 7.0, and is still achievable depending on
development during the fourth quarter.
Operating environment, short-term risks and
uncertainties in business operations
The operating environment in the western countries has been
relatively stable during the review period, however, changes in
demand, development in market prices as well as rising inflation
and interest rates impacted the financial development and generated
uncertainty. The economy in European Union broadly stagnated over
the first half year, and is likely to remain subdued in the coming
months which grows risks to all Aspo’s businesses. In addition, the
rising interest rates have negatively impacted investment
activities, particularly through increasing financing costs and
decreasing financing opportunities. As a consequence, the M&A
market has slowed down, partially also because of differing views
on valuations by the sellers and buyers. Volatile exchange rates
also reflect the high inflation, which varies from one area to
another causing fluctuations in local demand.
Overall economic development, specific demand and production
volumes in key industries, especially metal and forest products,
may increase or decrease the demand for sea transportation. In this
respect, ESL Shipping comparatively benefits from long-term
industrial partnerships and a general deficit of year-round vessel
capacity in the Baltic Sea area. The shipping freight indexes have
strengthened since the beginning of September, reflecting growing
demand and price level.
Market price development, and especially sudden declines in raw
material prices, can cause a negative profit impact for Telko and
Leipurin. The effect of such development has been mitigated by
active product portfolio management, combined with specific
commercial and operational measures, incl. inventory
management.
Recent events in the Middle East can negatively affect Aspo’s
businesses, e.g. in terms of energy prices and supply chain
disruptions, as well as inflation-driven wage increases.
In line with its strategy, Aspo aims to increase its
profit-making ability through acquisitions. Strategy execution
combined with the currently relatively high financing costs may
reduce free cash flow and lead to a temporary deterioration of the
balance sheet, in situations where capital expenditures and
acquisitions require financial resources, and consequently may
reduce solvency. With its strategy, Aspo aims to reduce the impact
of the possibly weakening general economic development on Aspo’s
profit-making ability.
Aspo’s ambition is to fully exit selected eastern markets and
especially Russia. The transaction of Leipurin, has still not been
approved by the Russian governmental bodies, and the net asset
values of the related companies are still at risk. In addition,
translation differences will generate losses in the eventual exit.
On the positive side, Leipurin Russia has been operationally
profitable and the major losses resulting from Aspo’s withdrawal
process from Russia were already accounted for in 2022 and during
the first half of 2023 when Telko Russia was divested. Because the
future estimates presented in this interim report are based on the
current situation and knowledge, they involve significant risks and
other uncertainties, due to which actual future outcomes may differ
from the estimates.
Net sales by market area, continuing
operations |
|
|
|
|
|
|
|
|
|
|
|
|
1-9/2023 |
Share |
1-9/2022 |
Share |
1-12/2022 |
Share |
|
MEUR |
% |
MEUR |
% |
MEUR |
% |
Finland |
144.1 |
35.7 |
165.8 |
40.7 |
224.4 |
40.0 |
Scandinavian
countries |
119.1 |
29.5 |
98.9 |
24.3 |
137.6 |
24.5 |
Baltic
countries |
49.1 |
12.1 |
49.7 |
12.2 |
67.8 |
12.1 |
Other European
countries |
58.1 |
14.4 |
68.8 |
16.9 |
89.6 |
16.0 |
Other
countries |
33.8 |
8.3 |
24.6 |
6.0 |
41.3 |
7.4 |
Total |
404.2 |
100 |
407.8 |
100 |
560.7 |
100 |
From the beginning of year 2023, following the shift of the
strategic focus towards western markets, Aspo changed the market
areas when reporting net sales. The new reportable market areas
are: Finland, Scandinavian countries, Baltic countries, Other
European countries and Other countries. The acquisition of Kobia
has significantly increased the contribution of Scandinavia to the
Group’s total net sales.
Cash flow and financing
The Group’s net cash flow from operating activities in
January–September was EUR 35.0 (45.7) million. The cash flow of all
businesses was positive, and the decrease compared to the
comparative period came from the ESL Shipping segment. The cash
flow impact of change in working capital was EUR 4.0 (-5.8)
million. The positive cash impact was caused by a decrease in
inventories driven by proactive operational management actions.
This effect was partly offset by increased accounts receivable and
decreased accounts payable.
The free cash flow in January–September was EUR 27.0 (17.9)
million. Investments amounted to EUR 11.7 (15.2) million and
consisted mainly of the ESL Shipping segment’s Green Coaster
advance payments. The other items reported in cash flows used in
investing activities included EUR 3.9 million cash outflow from the
acquisitions of Eltrex, EUR 10.5 million cash inflow from the sale
of Kobia’s properties in Sweden, and EUR 1.1 million cash inflow
from the sale of Leipurin’s property in Lithuania, EUR 4.5 million
cash outflow from the sale/discontinuation of Telko’s subsidiaries
in Russia and Belarus and other cash inflow of EUR 0.5 million.
|
9/2023 |
9/2022 |
12/2022 |
|
MEUR |
MEUR |
MEUR |
Interest-bearing liabilities, incl. lease liabilities |
187.8 |
204.0 |
189.3 |
Cash and cash
equivalents, Group total |
34.6 |
43.7 |
33.6 |
Net
interest-bearing debt |
153.2 |
160.3 |
155.7 |
Net interest-bearing debt was EUR 153.2 (12/2022: 155.7) million
and gearing decreased to 104.5% (12/2022: 108.4%). The Group’s
equity ratio at the end of the review period was 35.8% (34.7%).
Net financial expenses in January–September totaled EUR -6.6
(-4.0) million. The average interest rate of interest-bearing
liabilities, excluding lease liabilities, increased and was 4.9%
(1.8%), causing Aspo’s interest expenses to grow.
The Group’s liquidity position remained strong. Cash and cash
equivalents, Group total stood at EUR 34.6 (12/2022: 33.6) million
at the end of the review period, of which cash and cash equivalents
related to businesses held for sale were EUR 3.5 (11.9) million.
Current interest-bearing liabilities have increased, and
non-current interest-bearing liabilities decreased as an increased
share of the non-current loans will fall due within the next twelve
months. Committed revolving credit facilities, totaling EUR 40
million, were fully unused, as in the comparative period. Aspo’s
EUR 80 million commercial paper program also remained fully
unused.
In September Aspo signed a loan agreement of EUR 30 million for
a three-year loan period extending the maturity of Aspo’s loan
portfolio. The loan has been taken for general corporate purposes
and refinancing a loan of similar value.
ASPO’S BUSINESSES
ESL Shipping
ESL Shipping is the leading dry bulk sea transport company
operating in the Baltic Sea area. ESL Shipping’s operations are
mainly based on long-term customer contracts and established
customer relationships. At the end of the review period, the
shipping company’s fleet consisted of 42 vessels with a total
capacity of 438,000 deadweight tons (dwt). Of these, 23 were wholly
owned (78% of the tonnage), two were minority owned (2%) and the
remaining 17 vessels (20%) were time chartered.
ESL Shipping’s competitive edge is based on its pioneering role
and ability to responsibly and energy efficiently secure product
and raw material transportation for industries and energy
production year-round, even in difficult conditions. The shipping
company loads and unloads large ocean liners at sea as a special
service.
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
Change,% |
1-9/2023 |
1-9/2022 |
Change,% |
Net sales,
MEUR |
43.0 |
65.0 |
-34 |
139.7 |
182.1 |
-23 |
Operating profit,
MEUR |
4.0 |
9.8 |
-59 |
13.3 |
28.0 |
-53 |
Operating profit,
% |
9.3 |
15.1 |
|
9.5 |
15.4 |
|
Items affecting
comparability, MEUR |
0.0 |
0.0 |
|
0.0 |
1.1 |
|
Comparable
operating profit, MEUR |
4.0 |
9.8 |
-59 |
13.3 |
26.9 |
-51 |
Comparable
operating profit, % |
9.3 |
15.1 |
|
9.5 |
14.8 |
|
In the third quarter ESL Shipping’s net sales decreased
significantly by 34% from the previous all-time high year to EUR
43.0 (65.0) million. The comparable operating profit for the
quarter decreased by 59% to EUR 4.0 (9.8) million, with the
comparable operating profit rate being 9.3% (15.1%). ESL Shipping’s
result improved in comparison to the second quarter earnings,
despite the poor market conditions and production reductions in
several customer industries during the summer. Resulting from lower
overall market activity, smaller capacity and longer voyages, the
cargo volumes transported by ESL Shipping decreased from the
comparative period to 3.1 (3.8) million tons. The overall freight
market activity in Scandinavia and Continental Europe remained at
lower level compared to the previous year.
ESL Shipping’s handysize vessels had somewhat lower than
expected overall volume demand during the third quarter of 2023.
Steel industry demand from long-term partnership industries
remained close to the forecasted level. Energy shipping markets
continued depressed due to prevailing high stock levels and
exceptionally warm September month. The share of energy coal
remained below 5% of transported volumes. To find a better supply
and demand balance, one handysize vessel was time-chartered out
also during the third quarter. As informed earlier, the financial
performance of the handysize vessels suffered during the third
quarter from dockings of two most efficient and profitable
vessels.
Coaster vessel volumes remained at fairly good levels in steels,
minerals, chemicals and agriculture. The forest industry
experienced a volume decrease especially in raw materials and sawn
timber. Coaster vessel result was positively affected by very
successful operation and high-capacity utilization of the available
fleet. The negative effect of high time-charter unit costs
continued, despite the first signs of a decline in cost levels. At
the same time, the two partly owned vessels delivered good
result.
Supramax vessels still suffered from the soft spot market during
the third quarter, but during September month the spot market
started to gradually pick up affecting demand for this vessel type
positively. During the third quarter, the price of diesel fuel
started to rapidly increase from the previous quarter. The price of
liquified natural gas LNG remained more stable due to seasonally
low demand. However, during the third quarter ship fuel prices were
significantly lower than the levels experienced during the
comparative period last year and this had a EUR 4.7 million
negative impact on net sales due to lower fuel surcharges. Energy
price fluctuations are managed through neutral fuel clauses in
long-term transportation agreements.
The newbuilding project of ESL Shipping’s Swedish subsidiary
AtoBatC Shipping AB at the Chowgule & Company Private Limited
shipyard in India proceeded as planned during the third quarter. A
total of seven vessels are already under construction and the first
vessel in the series, Electramar, is expected to be delivered
during the fourth quarter. The second vessel, Stellamar, was
launched right after the end of the review period on 1st October.
Every other vessel in the series of 12 next-generation electric
hybrid vessels will be sold, as announced earlier, to the company
established by the pooling investor group.
During the third quarter four vessels were docked for 43 (63)
days. Compared to the comparative period in previous year when
mostly smaller coaster vessels were docked, maintained vessels were
larger, more efficient and more profitable units and therefore
operating result for the third quarter in 2023 was negatively
affected.
The net sales of ESL Shipping in January–September decreased by
23% from the comparative period, amounting to EUR 139.7 (182.1)
million. The comparable operating profit halved to EUR 13.3 (26.9)
million and the comparable operating profit rate was 9.5% (14.8%).
ESL Shipping’s operating profit was at EUR 13.3 (28.0) million for
January-September 2023 and the operating profit rate was 9.5%
(15.4%).
ESL Shipping outlook
In the fourth quarter, ESL Shipping’s main markets in the
Northern Baltic Sea, Scandinavia and Continental Europe are
expected to suffer from a lower level of industrial activity
compared to the previous year. Typically for dry bulk shipping, the
freight market activity has, as expected, picked up to some extent
after mid-summer slowdown, affecting also the fourth quarter
positively. Increased agriproduct volume demand from new harvest
and increased demand from the energy industry are expected to drive
volume demand during the rest of the year. Announced industrial
actions in Finland may cause supply chain disruptions.
ESL Shipping’s long-term partners in the steel industry are
expected to have fairly stable volumes corresponding with previous
year figures for the remaining part of the year. Steel demand in
Europe is expected to remain weak in the construction industry and
ESL Shipping’s steel industry clients are prepared to adjust their
production if needed. In the forest industry, wood pulp delivery
volumes are modest due to high stock levels. Resulting from present
difficulties in European construction industries, sawn goods demand
is likely to continue lower than earlier expected, despite the fact
that the production capacity of our main customers is increasing.
During the remaining of 2023 vessels are expected to have
approximately 10 maintenance days.
Several factors support positive development for ESL Shipping
going forward. Firstly, most of the shipping company’s
transportation capacity has been secured through long-term
agreements with the exception of the supramax vessels, which
operate partly in Arctic trade and largely on the spot market.
Secondly, the availability of vessel capacity suitable for
year-round operations in the Baltic Sea remains tight due to an
ageing fleet. The expectations of the lessors of the time-chartered
vessels may cause further uncertainties in the availability and
pricing of a suitable tonnage. Thirdly, ESL Shipping’s investments
in energy-efficient vessels will strengthen its competitiveness and
market position in the future. ESL Shipping is finalizing
development of a completely fossil-free sea transportation
ecosystem in cooperation with its key partners and customers.
As informed in a separate stock exchange release on 26th April,
Aspo‘s Board of Directors decided to initiate a review of strategic
options to support and accelerate ESL Shipping’s low-carbon growth
strategy. The ongoing program is assessing alternative measures,
including launch of a second wave investment pool, a possible
equity injection in ESL Shipping by a minority shareholder, and the
sale of ESL Shipping’s two supramax vessels. The first results of
this strategic review are expected still during year 2023.
Telko
Telko is a leading expert in and supplier of plastic raw
materials, industrial chemicals, and lubricants. It operates as a
sustainable partner in the value chain, bringing well-known
international principals and customers together. Its competitive
edge is based on strong technical support, efficient logistics and
local expert service. Telko operates in Finland, the Baltic
countries, Scandinavia, Poland, Romania, Ukraine, Kazakhstan,
Uzbekistan, and China.
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
Change,% |
1-9/2023 |
1-9/2022 |
Change,% |
Net sales,
MEUR |
53.8 |
51.6 |
4 |
162.3 |
155.1 |
5 |
Operating profit,
MEUR |
3.1 |
3.6 |
-14 |
5.7 |
6.0 |
-5 |
Operating profit,
% |
5.8 |
7.0 |
|
3.5 |
3.9 |
|
Items affecting
comparability, MEUR |
0.0 |
0.5 |
|
-1.0 |
-3.6 |
|
Comparable
operating profit, MEUR |
3.1 |
3.1 |
0 |
6.7 |
9.6 |
-30 |
Comparable
operating profit, % |
5.8 |
6.0 |
|
4.1 |
6.2 |
|
In the third quarter of 2023, Telko’s net sales increased by 4%
to EUR 53.8 (51.6) million and its comparable operating profit
remained flat at EUR 3.1 (3.1) million. Telko’s comparable
operating profit rate was 5.8% (6.0%). Telko’s cashflow was strong
during the third quarter as inventory levels were significantly
reduced and are now well in balance with current demand. During the
third quarter Telko completed almost all of the planned cost
efficiency actions, which will generate close to full profit impact
starting from the fourth quarter.
Net sales of the plastics business remained at last year’s level
during the third quarter, amounting to EUR 26.5 (26.5) million. The
challenging market conditions continued in the third quarter and
demand remained lower than normal market levels. Prices declined
heavily during the second quarter but stabilized during the third
quarter. Prices of volume plastics in Europe were on average 30%
lower than in the previous year. However, Telko managed to
compensate for lower prices by significant sales volume growth and
thus managed to increase market share. In Engineering plastics
price development and changes in demand have been more stable.
Net sales of the chemicals business increased by 21% during the
third quarter, amounting to EUR 14.9 (12.3) million. Net sales
growth was primarily driven by the Eltrex acquisition. The demand
was fairly low during the third quarter in most customer segments.
Price erosion stopped in most product lines during the summer and
towards the end of the third quarter prices were relatively stable.
The integration of Eltrex has progressed as planned with sales
development in line with targets and sales synergies starting to
emerge.
Net sales of the lubricants business decreased by 3% to EUR 12.4
(12.8) million. In Automotive lubricants sales declined slightly
driven by lower consumer demand. Industrial lubricants continued to
demonstrate very positive development.
Telko’s net sales increased by 5% during January–September to
EUR 162.3 (155.1) million, primarily driven by acquisitions.
Telko’s comparable operating profit for the first three quarters
was EUR 6.7 (9.6) million, and the comparable operating profit rate
was 4.1% (6.2%). Telko’s operating profit was at EUR 5.7 (6.0)
million for January-September 2023 and the operating profit rate
was 3.5% (3.9%).
Telko outlook
Telko has faced significant changes in its business environment
during the year. Despite all the changes, the core of Telko’s
strategy will remain the same. As a leading expert serving multiple
industries, Telko is in a unique position to create value by
improving its customers’ sustainability, productivity, and
operational quality. Telko’s long-term growth efforts will
increasingly be focused on Europe, and the main components of the
company’s value proposition will remain unchanged.
In general, the business outlook in the European market looks
weaker than a year ago. Telko serves industrial customers in
various industries. Possible changes in demand will be outbalanced
by the heterogenic cyclicality of the diversified customer base,
and hence Telko’s business is expected to remain fairly resilient
to overall market development. In addition, Telko’s efforts to
improve scalability and cost efficiency further stabilize
performance.
In plastics, overall market conditions will remain challenging
for the coming months. There are no expectations of improvement in
customer demand during the last quarter. Volume plastic prices are
expected to be on a slightly higher level than during previous
quarters, but still significantly lower than in the previous year.
Sales margins are expected to recover as a result of more favorable
price development. Telko expects to continue to increase market
share both in volume and specialty products.
In chemicals, demand is expected to remain fairly low during the
fourth quarter in key markets. It is expected that the price
erosion has stopped, and prices will be relatively stable following
raw material price development. Ukraine is expected to suffer from
extensive production shutdowns during the winter season.
For lubricants, demand is expected soften slightly towards end
of the year. Continued stable sales is expected for industrial
lubricants during the last quarter, partially driven by growth in
market share. The slower economic development will have an adverse
impact on demand, especially for automotive lubricants. Market
prices continue to be under pressure due to oversupply in the
market.
The recent acquisitions have proven to be successful, and they
have had a positive impact on the existing businesses. Telko aims
to accelerate its growth through acquisitions to achieve its
strategic goals in all three business areas. Telko will also seek
to strengthen its market share in its current markets through
organic growth.
In order to secure good profitability, Telko will further
improve cost efficiency and continue to develop its operating model
towards better scalability and flexibility. Good inventory control
and capital efficiency will remain a high priority for Telko. The
asset-light business model of Telko enables better ability to
utilize new business opportunities and react to changes in the
business environment.
Leipurin
Leipurin operates as part of the food chain, sourcing raw
materials in global markets and from domestic companies, and
supplying them through its effective logistics chain to serve
customer needs. With operations in six countries including Finland,
Sweden, the Baltic countries, and Ukraine, Leipurin serves
bakeries, the food industry, and food service customers by
providing raw materials, supporting research & development,
recipes, and innovations for new products.
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
Change,% |
1-9/2023 |
1-9/2022 |
Change,% |
Net sales,
MEUR |
33.2 |
26.2 |
27 |
102.2 |
70.6 |
45 |
Operating profit,
MEUR |
2.0 |
-0.5 |
-500 |
4.6 |
-1.6 |
-388 |
Operating profit,
% |
6.0 |
-1.9 |
|
4.5 |
-2.3 |
|
Items affecting
comparability, MEUR |
0.7 |
-1.0 |
|
1.2 |
-2.2 |
|
Comparable
operating profit, MEUR |
1.3 |
0.5 |
160 |
3.4 |
0.6 |
467 |
Comparable
operating profit, % |
3.9 |
1.9 |
|
3.3 |
0.8 |
|
Leipurin’s net sales increased by 27% during the third quarter
to EUR 33.2 (26.2) million. Sales growth was primarily driven by
the acquisition of Kobia and inflation. In Finland net sales
increased by 3% to EUR 12.6 (12.2) million. In the Baltic
countries, net sales decreased by 7% to EUR 8.7 (9.4) million. Net
sales in Ukraine was on previous year’s level EUR 0.2 (0.2)
million. Sweden was established as a new business unit following
the acquisition of Kobia AB on September 1, 2022, and it
contributed with EUR 11.7 (4.4) million and approximately 35% of
Leipurin’s net sales in the third quarter of 2023. During the third
quarter, sales to bakeries increased by 26% to EUR 24.4 (19.4)
million, driven by the Kobia acquisition. Sales to the food
industry decreased by 7% to EUR 2.9 (3.1) million, driven by a
decline in selected volume product categories
The heavy price increases experienced throughout last year
flattened out towards the end of the third quarter this year, and
some commodity items turned even into a price decline.
Concurrently, the decline in kilo volumes flattened out across the
board.
The comparable operating profit for the third quarter stood at
EUR 1.3 (0.5) million, and the comparable operating profit rate was
3.9% (1.9%). The comparable operating profit of the comparison
period was negatively affected by the reversal of an inventory fair
value adjustment of EUR -0.4 million recognized in the Kobia
acquisition. Items affecting comparability, totaling EUR 0.7 (-1.0)
million, included the sales gain related to the sale and leaseback
transaction of Leipurin’s property in Lithuania, and expenses
related to the restructuring of the operating model in Sweden. In
the comparative period the comparability was mainly affected by
items related to the acquisition of Kobia. Leipurin’s operating
profit for the third quarter was EUR 2.0 (-0.5) million and
operating profit rate 6.0% (-1.9%).
In January–September, Leipurin’s net sales increased by 45% to
EUR 102.2 (70.6) million. Figures for the comparative period
included EUR 4.3 million in net sales of the divested Vulganus Oy.
Kobia AB’s acquisition contributed to the net sales growth by EUR
32.9 million and its share of Leipurin’s net sales was 36% during
the period. The steep increase in raw material prices in global
markets had a significant impact on the euro-denominated increase
in sales, particularly in the first quarter and the beginning of
the second quarter.
Leipurin’s comparable operating profit in January–September 2023
was EUR 3.4 (0.6) million, and the comparable operating profit rate
was 3.3% (0.8%). Items affecting comparability, totaling EUR 1.2
(-2.2) million, were mainly related to the gain on the sale and
leaseback transactions of properties in Sweden and Lithuania. The
comparative period was mainly affected by the destroyed warehouse
in Ukraine, items related to the divestment of Vulganus, and
acquisition of Kobia. The operating profit was EUR 4.6 (-1.6)
million and operating profit rate 4.5% (-2.3%).
Leipurin completed the sale and leaseback of the property in
Gothenburg, Sweden during the first quarter, and the properties in
Hässleholm and Tyresö, Sweden during the second quarter. These
actions generated sales proceeds of EUR 13.6 million, which
represents a significant share of the capital that was invested
when acquiring Kobia AB. During the third quarter, Leipurin
completed the sale and leaseback of the property in Kaunas,
Lithuania at a sale price of EUR 1.1 million, and the goal going
forward is to find modern and efficient facilities that are better
suited to Leipurin Lithuania’s operations. The transactions will
not have a significant impact on profitability going forward.
Leipurin outlook
After a period of significant volatility, the market is setting
into more of an equilibrium. Both price and volume outlook remain
somewhat volatile, but a general trend of price increases combined
with overall volume decline is diminishing. Despite this, demand
volatility has been exceptionally high in the third quarter, and
forecasting monthly demand is therefore difficult. Leipurin expects
inflation in Leipurin market segments and product categories to
even out in the fourth quarter and into next year. Inflation-driven
wage increases are expected to hit companies’ operating expenses at
full scale next year.
The operating model of Kobia has been re-structured, which will
enable better focus to address the market segments in Sweden,
including segments where Kobia has not operated in the past, as
well as to address operational efficiency. As Kobia relies
relatively heavily on domestic supplies, the weak Swedish krona
doesn’t have a drastic effect on Kobia’s operating profit in SEK,
but obviously it does affect Leipurin’s figures in euros.
Leipurin strategy for the coming years is being finalized.
Management sees clear opportunities for organic growth as well as
efficiency improvements in the countries. To strengthen growth and
company positioning, Leipurin evaluates possible acquisition
opportunities, as well as opportunities to further strengthen
business focus by divesting or discontinuing some non-core,
low-profitability parts of the business.
Non-core businesses
The Non-core businesses segment includes Telko Russia and
Belarus as well as Kauko GmbH previously reported in the Telko
segment, Leipurin Russia, Belarus and Kazakhstan previously
reported in the Leipurin segment and ESL Shipping Russia previously
reported in the ESL Shipping segment. The Non-core businesses
segment was established to separate the results of the non-core
businesses of Aspo from the results of the continuing businesses.
The Non-core businesses segment is presented as discontinued
operations. All the entities in the segment are either held for
sale, in the process of being closed down. Telko Russia was
divested on April 30, 2023 and Telko Belarus was discontinued on
September 30, 2023.
|
7-9/2023 |
7-9/2022 |
Change,% |
1-9/2023 |
1-9/2022 |
Change,% |
Net sales,
MEUR |
3.3 |
14.9 |
-78 |
13.0 |
71.7 |
-82 |
Operating profit,
MEUR |
-1.5 |
0.6 |
-350 |
-9.6 |
10.0 |
-196 |
Operating profit,
% |
-45.5 |
4.0 |
|
-73.8 |
13.9 |
|
Items affecting
comparability, MEUR |
-2.0 |
-0.1 |
|
-9.7 |
-1.5 |
|
Comparable
operating profit, MEUR |
0.5 |
0.7 |
-29 |
0.1 |
11.5 |
-99 |
Comparable
operating profit, % |
15.2 |
4.7 |
|
0.8 |
16.0 |
|
The net sales of the Non-core businesses segment declined by 78%
during the third quarter to EUR 3.3 (14.9) million. The comparable
operating profit was EUR 0.5 (0.7) million and the comparable
operating profit rate was 15.2% (4.7%). The negative net sales
development was primarily driven by the divestment of Telko’s
Russian business. The comparable operating profit was primarily a
result of Leipurin’s subsidiaries in Russia as well as positive net
impact of currency fluctuations. The operating profit was EUR -1.5
(0.6) million. The operating profit included EUR -2.0 (-0.1)
million of items affecting comparability, which were caused by an
adjustment of the cumulative translation differences booked as part
of the divestment loss of Telko’s subsidiary in Russia of EUR -0.7
million, a loss of EUR -1.0 million for the discontinuation of
Telko’s subsidiary in Belarus, and EUR -0.3 million of valuation
adjustments relating to the other eastern businesses held for
sale.
Telko’s subsidiary in Belarus was discontinued and derecognized
from Aspo Group during the third quarter. The company is currently
in liquidation. The recognized loss was EUR -0.8 million, including
accumulated translation differences of EUR -1.0 million that were
reclassified from the translation reserve in equity to other
operating expenses in the profit and loss.
In January–September, the net sales of the Non-core businesses
segment decreased by 82% to EUR 13.0 (71.7) million. The comparable
operating profit was EUR 0.1 (11.5) million, and the comparable
operating profit rate was 0.8% (16.0%). Items affecting
comparability, totaling EUR -9.7 (-1.5) million consisted of the
divestment loss of Telko Russia EUR -8.1 million, the write down of
Telko Russia’s inventory EUR -1.7 million, a loss of EUR -0,8
million for the discontinuation of Telko’s subsidiary in Belarus,
and EUR 0.9 million of valuation adjustments relating to the other
eastern businesses held for sale. The operating profit was EUR -9.6
(10.0) million, and the operating profit rate was -73.8%
(13.9%).
The divestment of Telko’s Russian subsidiary was completed
during the second quarter. The company was sold to the Russian
industrial operator GK Himik. The received sales price was EUR 5.7
million. The money received corresponded materially to the
remaining value of the company in Aspo Group considering the
impairment losses recognized already in 2022 and the valuation
adjustments done in 2023. The loss on sale was EUR -8.1 million,
including accumulated translation differences of EUR -10.2 million
that were reclassified from the translation reserve in equity to
other operating expenses in the profit and loss.
Non-core businesses outlook
Aspo has not yet received acceptance to the sale of Leipurin
Russia, by the necessary Russian governmental bodies. It is
difficult to assess, when such acceptance will be received, and
hence Aspo is in parallel assessing alternative measures for
exiting Russia and selected other Eastern markets.
The businesses held for sale are measured at fair value less
cost to sell. The valuation is based on management judgement and
may differ significantly from the outcome. On divestment, the
cumulative translation differences of foreign subsidiaries are
recognized as part of the sales gain or loss. At the end of the
third quarter, the net asset value of the eastern businesses held
for sale was EUR 2.7 million and the cumulative translation
differences amounted to EUR -4.5 million. The translation
differences fluctuate according to changes in exchange rates. The
reclassification of the translation differences from the
translation difference reserve to the profit and loss has no impact
on Aspo Group’s total equity.
Other operations
Other operations include Aspo Group’s administration, finance
and ICT service center. In the third quarter the comparable
operating profit of other operations was EUR -1.0 (-1.0) million.
The operating profit of the quarter was EUR -1.0 (-1.1) million. An
item affecting comparability of EUR -0.1 million was reported in
the third quarter of 2022 and it related to corporate
restructuring.
In January-September the comparable operating profit of other
operations was EUR -4.0 (-4.3) million and the operating profit was
EUR -4.1 (-4.9) million. The improved profitability derives from
some restructuring activities at Aspo Group level. The items
affecting comparability of -0.1 million related to corporate
restructuring costs. In January-September 2022, the items affecting
comparability of EUR -0.6 million were related to the additional
share-based remuneration granted to Aspo’s previous CEO of EUR -0.5
million and to EUR -0.1 million of corporate restructuring
expenses.
COMPANY INFORMATION
Aspo aims to achieve sustainable long-term growth by
re-investing earned profits in profitable investment objects and by
taking steps towards a compounder profile. Aspo enables growth for
the businesses it owns and aims to improve their profitability and
earnings by developing them and ensuring steady cash flows. The
goal is to assume an even more active role in mergers,
acquisitions, and other restructuring activities as well as in
growth investments in the owned businesses. Aspo focuses especially
on B-to-B industrial services, and its key clusters include
logistics and trade.
Key businesses in Aspo’s portfolio are ESL Shipping, Telko and
Leipurin. They are responsible for their own operations and
customer relationships, as well as for developing these.
Sustainability is a key factor of Aspo’s management system and
guides the process of targeting new investment opportunities.
Share capital and sharesAspo Plc’s registered
share capital on September 30, 2023, was EUR 17,691,729.57, and the
total number of shares was 31,419,779, of which the company held
16,244 shares, i.e. approximately 0.05% of the share capital.
Based on the authorization by the Annual Shareholders’ Meeting
2022, Aspo’s Board of Directors decided to start a repurchasing
program of the company's own shares on March 9, 2023. Additional
treasury shares were needed for the purposes of the share-based
incentive programs. During the period from March 9 to March 31,
2023, Aspo acquired a total of 36,194 of its own shares in trading
organized by Nasdaq Helsinki Ltd.
Aspo Plc has one share series. Each share entitles the
shareholder to one vote at the Shareholders’ Meeting. Aspo’s share
is quoted on Nasdaq Helsinki Ltd’s Mid Cap segment under Industrial
Goods and Services.
In January-September 2023, a total of 1,315,036 Aspo Plc shares,
with a market value of EUR 9.8 million, were traded on Nasdaq
Helsinki. In other words, 4,2% of the shares changed hands. During
the review period, the share price reached a high of EUR 8.70 and a
low of EUR 5.91. The average price was EUR 7.45 and the closing
price at the end of the review period was EUR 5.97. At the end of
the review period, the market value, less treasury shares, was EUR
187.5 million.
The company had 11,631 shareholders at the end of the review
period. A total of 907,927 shares, or 2.9% of the share capital,
were nominee registered or held by non-domestic shareholders.
Remuneration
Share-based incentive plan 2023–2025
On February 15, 2023, Aspo Plc’s Board of Directors approved a
new incentive plan for the Group key employees by establishing a
new Performance Share Plan 2023–2025. The aim of the plan is to
combine the objectives of the shareholders and the key employees in
order to increase the value of the Company in the long-term, to
retain the key employees at the Company, and to offer them
competitive reward plan based on earning and accumulating the
Company´s shares.
Rewards earned from each of the three performance periods of the
Performance Share Plan will be based on the Group’s Earnings per
Share (EPS) and two criteria based on sustainability targets. The
prerequisite for participation in the plan and for receipt of
reward on the basis of the program is that a key person holds the
Company's shares or acquires the Company's shares, up to the number
predetermined by the Board of Directors.
The potential reward will be paid partly in the Company´s shares
and partly in cash in 2024, 2025 and 2026. The cash proportion is
intended to cover taxes and tax-related costs arising from the
reward to a key employee. As a rule, no reward will be paid if a
key employee´s employment or service ends before the reward
payment. The shares paid as reward may not be transferred during
the restriction period. As a rule, if a key employee´s employment
contract or director contract terminates during the restriction
period, he or she must gratuitously return the shares earned as
reward.
The Performance Share Plan 2023–2025 is directed to a maximum of
30 participants, including the members of the Group Executive
Committee. The rewards to be paid on the basis of the plan
correspond to the value of a maximum total of 320,000 Aspo Plc
shares including also the proportion to be paid in cash.
Share-based incentive plan 2022–2024
On February 16, 2022, Aspo Plc’s Board of Directors decided to
establish a share-based incentive plan for 2022–2024. The
share-based incentive plan consists of three earnings periods, with
the earned reward being based on the Group’s earnings per share
(EPS) and two sustainability indicators.
The share-based incentive plan is directed at a maximum of 30
people, including the members of the Group Executive Committee. The
potential reward will be paid partly in the company’s shares and
partly in cash in 2023, 2024 and 2025. The rewards payable based on
the plan correspond to a maximum total value of 400,000 Aspo Plc
shares, also including the proportion to be paid in cash.
For the 2022 earnings period, the targets were met at 90%
overall. On March 29, 2023, Aspo Plc granted 76,050 treasury shares
to employees included in the plan. The transfer was based on the
share issue authorization of the Annual Shareholders’ Meeting held
on April 6, 2022.
Share-based incentive plan 2020
In June 2022, Aspo’s Board of Directors granted 20,000 Aspo
shares to Aspo’s CEO Rolf Jansson based on the share-based
incentive plan for 2020 and the conditions of the CEO’s contract of
service. 10,000 of the shares and an amount of cash equaling their
value to cover taxes were transferred in June 2022 and at the same
time, Jansson acquired 10,000 shares from the markets at his own
expense in accordance with the contract. A second transfer of equal
nature and quantity took place in June 2023.
Decisions of the Annual Shareholders’
Meeting
Dividend
Aspo Plc’s Annual Shareholders’ Meeting held on April 4, 2023,
decided, as proposed by the Board of Directors, that EUR 0.23 per
share be distributed in dividends for the 2022 financial year, and
that no dividend be paid for shares held by Aspo Plc. The dividend
was paid on April 17, 2023.
In addition, the Annual Shareholders’ Meeting authorized the
Board of Directors to decide on another dividend distribution in
the maximum amount of EUR 0.23 per share at a later date. The
authorization is valid until the next Annual Shareholders’ Meeting.
The Board of Directors will decide in its meeting agreed to be held
on November 1, 2023, of the second dividend distribution which
would be paid in November 2023 to shareholders who are registered
in the shareholders’ register maintained by Euroclear Finland Ltd
on the record date.
All the decisions of the Annual Shareholders’ Meeting can be
found on www.aspo.com.
FINANCIAL INFORMATIONAspo Group’s
condensed consolidated statement of comprehensive
income
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
Continuing operations |
|
|
|
|
|
Net
sales |
130.0 |
142.8 |
404.2 |
407.8 |
560.7 |
Other operating
income |
1.5 |
0.1 |
3.4 |
2.0 |
3.0 |
Materials and
services |
-82.3 |
-84.1 |
-257.1 |
-238.8 |
-332.2 |
Employee benefit
expenses |
-11.4 |
-11.3 |
-36.3 |
-35.7 |
-48.8 |
Depreciation,
amortization, and impairment losses |
-4.9 |
-4.8 |
-14.4 |
-12.9 |
-18.0 |
Depreciation and
impairment losses, leased assets |
-3.5 |
-3.8 |
-10.4 |
-11.5 |
-15.2 |
Other operating
expenses |
-21.3 |
-27.1 |
-69.9 |
-83.4 |
-111.1 |
Operating
profit |
8.1 |
11.8 |
19.5 |
27.5 |
38.4 |
|
|
|
|
|
|
Financial income
and expenses |
-2.5 |
-1.9 |
-6.6 |
-4.0 |
-5.9 |
|
|
|
|
|
|
Profit
before taxes |
5.6 |
9.9 |
12.9 |
23.5 |
32.5 |
|
|
|
|
|
|
Income taxes |
-0.3 |
-0.7 |
0.3 |
-1.4 |
-1.7 |
Profit
from continuing operations |
5.3 |
9.2 |
13.2 |
22.1 |
30.8 |
|
|
|
|
|
|
Profit from
discontinued operation (attributable to equity holders of the
company) |
-1.4 |
0.2 |
-7.8 |
4.0 |
-10.1 |
Profit
for the period |
3.9 |
9.4 |
5.4 |
26.1 |
20.7 |
|
|
|
|
|
|
Other
comprehensive income |
|
|
|
|
|
Items that may be
reclassified to profit or loss in subsequent periods: |
|
|
|
|
|
Translation
differences |
1.7 |
-2.1 |
6.8 |
6.0 |
-1.2 |
Other
comprehensive income for the period, net of taxes |
1.7 |
-2.1 |
6.8 |
6.0 |
-1.2 |
Total
comprehensive income |
5.6 |
7.3 |
12.2 |
32.1 |
19.5 |
|
|
|
|
|
|
Profit
attributable to parent company shareholders |
3.9 |
9.4 |
5.4 |
26.1 |
20.7 |
|
|
|
|
|
|
Total comprehensive
income attributable to parent company shareholders |
5.6 |
7.3 |
12.2 |
32.1 |
19.5 |
|
|
|
|
|
|
Earnings per
share attributable to parent company shareholders,
EUR |
|
|
|
|
|
Basic and diluted
earnings per share |
|
|
|
|
|
Continuing
operations |
0.15 |
0.30 |
0.37 |
0.70 |
0.93 |
Discontinued
operations |
-0.05 |
0.00 |
-0.25 |
0.12 |
-0.32 |
Total |
0.10 |
0.30 |
0.12 |
0.82 |
0.61 |
Aspo Group’s condensed consolidated balance
sheet
|
9/2023 |
9/2022 |
12/2022 |
Assets |
MEUR |
MEUR |
MEUR |
|
|
|
|
Intangible
assets |
51.3 |
47.4 |
46.8 |
Tangible
assets |
163.8 |
181.0 |
178.4 |
Leased
assets |
20.0 |
20.4 |
15.9 |
Other non-current
assets |
2.3 |
1.8 |
1.5 |
Total non-current
assets |
237.4 |
250.6 |
242.6 |
|
|
|
|
Inventories |
60.6 |
79.3 |
69.9 |
Accounts
receivable and other receivables |
77.8 |
83.4 |
69.3 |
Cash and cash
equivalents |
31.1 |
43.7 |
21.7 |
|
169.5 |
206.4 |
160.9 |
Assets held for
sale |
3.8 |
3.0 |
12.4 |
Total current
assets |
173.3 |
209.4 |
173.3 |
|
|
|
|
Total
assets |
410.7 |
460.0 |
415.9 |
|
|
|
|
|
|
|
|
Equity
and liabilities |
|
|
|
|
|
|
|
Share capital and
premium |
22.0 |
22.0 |
22.0 |
Other equity |
124.5 |
142.2 |
121.7 |
Total equity |
146.5 |
164.2 |
143.7 |
|
|
|
|
Loans and
overdraft facilities |
100.6 |
156.7 |
154.3 |
Lease
liabilities |
7.6 |
5.5 |
4.6 |
Other
liabilities |
6.1 |
7.9 |
7.6 |
Total non-current
liabilities |
114.3 |
170.1 |
166.5 |
|
|
|
|
Loans and
overdraft facilities |
66.3 |
25.9 |
17.8 |
Lease
liabilities |
13.3 |
15.5 |
11.7 |
Accounts payable
and other liabilities |
69.2 |
82.2 |
72.3 |
|
148.8 |
123.6 |
101.8 |
Liabilities
directly associated with assets classified as |
|
|
|
held for
sale |
1.1 |
2.1 |
3.9 |
Total current
liabilities |
149.9 |
125.7 |
105.7 |
|
|
|
|
Total
equity and liabilities |
410.7 |
460.0 |
415.9 |
Aspo Group’s condensed consolidated cash flow
statement
|
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
CASH FLOWS
FROM/USED IN OPERATING ACTIVITIES |
|
|
|
Operating
profit, Group total |
9.9 |
36.0 |
31.2 |
Adjustments to
operating profit |
29.8 |
25.6 |
50.6 |
Change in
working capital |
4.0 |
-5.8 |
-6.7 |
Interest
paid |
-6.3 |
-6.8 |
-4.2 |
Interest
received |
0.5 |
0.6 |
0.3 |
Income taxes
paid |
-2.9 |
-3.9 |
-3.5 |
Net
cash from operating activities |
35.0 |
45.7 |
67.7 |
|
|
|
|
CASH FLOWS
FROM/USED IN INVESTING ACTIVITIES |
|
|
|
Investments |
-11.7 |
-15.2 |
-17.8 |
Proceeds from
sale of tangible assets |
11.8 |
1.8 |
1.8 |
Acquisition of
businesses |
-3.9 |
-15.6 |
-17.9 |
Disposal of
businesses |
-4.5 |
1.2 |
0.3 |
Dividends
received |
0.3 |
|
0.3 |
Net
cash used in investing activities |
-8.0 |
-27.8 |
-33.3 |
|
|
|
|
CASH FLOWS
FROM/USED IN FINANCING ACTIVITIES |
|
|
|
Proceeds from
loans |
30.0 |
29.6 |
29.6 |
Repayment of
loans |
-35.8 |
-8.3 |
-18.7 |
Net change in
commercial papers |
|
-5.0 |
-5.0 |
Payments for
purchase of own shares |
-0.3 |
|
|
Payments of
lease liabilities |
-10.8 |
-12.3 |
-16.2 |
Hybrid bond
repayment |
|
-20.0 |
-20.0 |
Proceeds from
Hybrid bond issue |
|
30.0 |
30.0 |
Hybrid bond,
interest paid |
-2.6 |
-1.8 |
-1.8 |
Hybrid bond,
issuance fees paid |
|
-0.3 |
-0.3 |
Dividends
paid |
-7.2 |
-7.2 |
-14.1 |
Net
cash used in financing activities |
-26.7 |
4.7 |
-16.5 |
|
|
|
|
|
|
|
|
Change
in cash and cash equivalents |
0.3 |
22.6 |
17.8 |
Cash and cash
equivalents January 1 |
33.6 |
17.7 |
17.7 |
Translation
differences |
-1.1 |
3.4 |
0.0 |
Change in
impairment of cash and cash equivalents |
1.8 |
|
-2.0 |
Cash
and cash equivalents at period-end, Group total |
34.6 |
43.7 |
33.6 |
Cash and cash
equivalents held for sale |
-3.5 |
0.0 |
-11.9 |
Cash and
cash equivalents in balance sheet |
31.1 |
43.7 |
21.7 |
Aspo Group consolidated statement of changes in
equity
|
Share capital and premium |
Other reserves |
Hybrid bond |
Translation differences |
Retained earnings |
Total |
|
|
MEUR |
Equity
January 1, 2023 |
22.0 |
16.5 |
30.0 |
-26.0 |
101.2 |
143.7 |
Comprehensive
income: |
|
|
|
|
|
|
Profit for the
period |
|
|
|
|
5.4 |
5.4 |
Translation
differences |
|
|
|
-4.4 |
|
-4.4 |
Reclassification of translation differences |
|
|
|
11.2 |
|
11.2 |
Total
comprehensive income |
|
|
|
6.8 |
5.4 |
12.2 |
Transactions
with owners: |
|
|
|
|
|
|
Dividend
payment |
|
|
|
|
-7.2 |
-7.2 |
Hybrid bond
interest |
|
|
|
|
-2.0 |
-2.0 |
Purchase of
own shares |
|
|
|
|
-0.3 |
-0.3 |
Share-based
incentive plan |
|
|
|
|
0.1 |
0.1 |
Total
transactions |
|
|
|
|
-9.4 |
-9.4 |
with
owners |
|
|
|
|
|
|
Equity
September 30, 2023 |
22.0 |
16.5 |
30.0 |
-19.2 |
97.2 |
146.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
January 1, 2022 |
22.0 |
16.5 |
20.0 |
-24.8 |
95.7 |
129.4 |
Comprehensive
income: |
|
|
|
|
|
|
Profit for the
period |
|
|
|
|
26.1 |
26.1 |
Translation
differences |
|
|
|
6.0 |
|
6.0 |
Total
comprehensive income |
|
|
|
6.0 |
26.1 |
32.1 |
Transactions
with owners: |
|
|
|
|
|
|
Dividend
payment |
|
|
|
|
-7.2 |
-7.2 |
Hybrid
bond |
|
|
10.0 |
|
|
10.0 |
Hybrid bond
interest and |
|
|
|
|
-0.8 |
-0.8 |
issuance
costs |
|
|
|
|
|
|
Share-based
incentive plan |
|
|
|
|
0.7 |
0.7 |
Total
transactions |
|
|
10.0 |
|
-7.3 |
2.7 |
with
owners |
|
|
|
|
|
|
Equity
September 30, 2022 |
22.0 |
16.5 |
30.0 |
-18.8 |
114.5 |
164.2 |
Accounting principlesAspo Plc’s interim report
has been prepared in accordance with the principles of IAS 34
Interim Financial Reporting. As of the beginning of the financial
year, Aspo applies certain new or amended IFRS standards and IFRIC
interpretations as described in the 2022 consolidated financial
statements. In other respects, the same accounting and measurement
principles have been applied as in the 2022 consolidated financial
statements. The information in this interim report is
unaudited.
Aspo Plc applies the guidance on alternative key figures issued
by ESMA. In addition to IFRS figures, the company releases other
commonly used key figures, which are mainly derived from the
statement of comprehensive income and balance sheet. According to
the management, key figures clarify the view drawn by the statement
of comprehensive income and balance sheet of Aspo’s financial
performance and financial position. The calculation principles of
key figures are explained on page 64 of Aspo’s Year 2022
publication.
Personnel
At the end of the review period, Aspo Group had 810 employees
(886 at the end of 2022), of which discontinued operations
accounted for 81 (130) employees.
Segment information
Aspo Group’s reportable segments are ESL Shipping, Telko,
Leipurin and Non-core businesses.
From the beginning of year 2023 Aspo has reported the eastern
businesses held for sale in a new segment called Non-core
businesses and at the same time, Aspo has classified the new
segment as discontinued operations. The comparative figures have
been restated for all segments impacted by this financial reporting
restructuring.
The Non-core businesses segment includes Telko Russia and
Belarus as well as Kauko GmbH previously reported in the Telko
segment, Leipurin Russia, Belarus and Kazakhstan previously
reported in the Leipurin segment as well as ESL Shipping Russia
previously reported in the ESL Shipping segment. The Non-core
businesses segment was established to separate the results of the
non-core businesses of Aspo from the results of the continuing
businesses. All the entities in the segment are either held for
sale, in the process of being closed down or already divested.
Reconciliation of segment operating profit to the Group's
profit before taxes from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1-9/2023 |
|
|
|
|
|
|
|
|
ESL Shipping |
Telko |
Leipurin |
Unallocated |
Group |
MEUR |
|
|
|
items |
total |
Operating
profit |
|
13.3 |
5.7 |
4.6 |
-4.1 |
19.5 |
Net financial expenses |
|
|
|
-6.6 |
-6.6 |
Profit before
taxes |
|
|
|
|
|
12.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1-9/2022 |
|
|
|
|
|
|
|
|
ESL Shipping |
Telko |
Leipurin |
Unallocated |
Group |
MEUR |
|
|
|
items |
total |
Operating
profit |
|
28.0 |
6.0 |
-1.6 |
-4.9 |
27.5 |
Net financial expenses |
|
|
|
-4.0 |
-4.0 |
Profit before
taxes |
|
|
|
|
|
23.5 |
The unallocated operating profit of EUR -4.1 (-4.9) million
includes the result of other operations.
Discontinued operations and other non-current assets and
disposal groups held for sale
The Non-core businesses segment established in the beginning of
the year has been classified as discontinued operations in
accordance with the IFRS 5 standard. In the statement of
comprehensive income, the figures for the comparative periods have
been restated. In the comparative periods the discontinued
operations also include the figures of Kauko Oy, which was divested
on October 31, 2022.
The divestment of Telko’s Russian subsidiary was completed
during the second quarter. The company was sold to the Russian
industrial operator GK Himik. The sales price received was EUR 5.7
million which materially corresponded to the carrying value of the
divested company's net assets considering the impairment losses
recognized already in 2022 and the valuation adjustments done in
2023. The loss on divestment was EUR -8.1 million, including
accumulated translation differences of EUR -10.2 million that were
reclassified from the translation reserve in equity to other
operating expenses in profit and loss. The amount of cumulative
translation differences booked as part of the divestment loss was
adjusted by EUR -0.7 million in the third quarter of 2023. The
costs to sell amounted to EUR -0.6 million.
Telko’s subsidiary in Belarus was discontinued and derecognized
from Aspo Group during the third quarter. The company is currently
in liquidation. The recognized loss was EUR -0.8 million, including
accumulated translation differences of EUR -1.0 million that were
reclassified from the translation reserve in equity to other
operating expenses in the profit and loss.
Profit
from discontinued operations |
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
Net sales |
3.3 |
17.2 |
13.0 |
80.1 |
91.9 |
Other operating
income |
0.0 |
0.1 |
0.0 |
0.2 |
0.3 |
Materials and
services |
-2.8 |
-14.1 |
-11.0 |
-60.6 |
-77.6 |
Employee benefit
expenses |
-0.3 |
-1.4 |
-1.8 |
-5.9 |
-7.1 |
Depreciation,
amortization and impairment losses |
-0.1 |
-0.1 |
0.1 |
-1.5 |
-3.1 |
Depreciation,
leased assets |
0.0 |
-0.2 |
-0.1 |
-0.5 |
-1.5 |
Other operating
expenses |
-1.6 |
-1.0 |
-9.8 |
-3.3 |
-10.1 |
Operating
profit |
-1.5 |
0.5 |
-9.6 |
8.5 |
-7.2 |
Financial income
and expenses |
0.2 |
-0.2 |
1.9 |
-3.0 |
-0.4 |
Profit
before taxes |
-1.3 |
0.3 |
-7.7 |
5.5 |
-7.6 |
Income taxes |
-0.1 |
-0.1 |
-0.1 |
-1.5 |
-2.5 |
Profit
for the period |
-1.4 |
0.2 |
-7.8 |
4.0 |
-10.1 |
Net
cash flows of discontinued operations |
|
|
|
|
|
|
|
|
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
|
|
MEUR |
MEUR |
MEUR |
Net cash
inflow from operating activities |
|
|
1.2 |
29.4 |
32.5 |
Net cash inflow/outflow(-) from investing activities |
|
-4.4 |
0.0 |
-1.0 |
Net cash inflow/outflow(-) from financing activities |
|
-0.3 |
-2.1 |
-2.1 |
Net change in cash generated by the discontinued
operations |
|
|
-3.5 |
27.3 |
29.4 |
|
|
|
|
|
Net cash flows of discontinued operations consist of the
Non-core businesses segment’s share of Aspo Group’s cash flows. In
the comparison periods the figures also include Kauko Oy’s cash
flows.
The cash flow from the sale of Telko’s subsidiary in Russia was
EUR -4.4 million and it is presented in the cash flow from
investing activities. The cash received as purchase consideration
was EUR 5.7 million and the divested company’s cash and cash
equivalents amounted to EUR 10.1 million.
In 2022, the cash flow from the divestment of Kauko Oy EUR -1.0
million is included in the cash flow from investing activities. The
cost to sell Kauko of EUR -0.4 million is presented in the cash
flow from operating activities. The cash flow from financing mainly
consisted of repayments of Kauko Oy’s interest-bearing loans in
2022.
Assets and liabilities classified as held for
sale |
|
|
|
|
|
|
|
9/2023 |
9/2022 |
12/2022 |
|
|
|
MEUR |
MEUR |
MEUR |
Assets of
discontinued operations |
|
|
3.8 |
3.0 |
12.4 |
Assets
classified as held for sale, total |
|
|
3.8 |
3.0 |
12.4 |
|
|
|
|
|
|
Liabilities of
discontinued operations |
|
|
1.1 |
2.1 |
3.9 |
Liabilities
directly associated with assets classified as held for sale,
total |
|
1.1 |
2.1 |
3.9 |
|
|
|
|
At the end of the third quarter of 2023 and at the end of year
2022 assets and liabilities of discontinued operations include the
assets and liabilities of the Non-core businesses segment. In the
comparative period 9/2022 they include the assets and liabilities
of Kauko operating segment.
The assets and businesses held for sale are measured at fair
value less cost to sell. On divestment, the cumulative translation
differences of foreign subsidiaries are recognized as part of the
sales gain or loss. At the end of the third quarter, the net asset
value of the eastern businesses held for sale was EUR 2.7 million
and the cumulative translation differences amounted to EUR -4.5
million. The translation differences fluctuate according to changes
in exchange rates. The reclassification of the translation
differences from the translation difference reserve to the profit
and loss has no impact on Aspo Group’s total equity.
Restricted cash and cash equivalents
In Russia, Aspo Group has EUR 3.4 million in cash and cash
equivalents, the use of which is strictly restricted by the Russian
Government and controlled by the banks. The value of these cash and
cash equivalents in the Group balance sheet is EUR 3.2 million, as
impairments of EUR 0.2 million have been recognized on them. Cash
and cash equivalents in Russia are presented under assets held for
sale on the balance sheet. During the year it has still been
possible to receive dividend payments and make commercial payments
with Russian entities. Also, during the second quarter Aspo
received the payment of EUR 5.7 million for the sale of Telko
Russia. According to our understanding and experience, the sales
price of the Leipurin entities classified as held for sale is also
expected to be received in conjunction with the sale of the
entities. However, there is a risk that the Group does not have
access to the cash and cash equivalents in full in Russia, and
therefore they are considered restricted in accordance with IAS
7.
Acquisition of Eltrex
On January 31, Telko acquired Eltrex, a Polish distributor of
specialty chemicals and industrial packaging materials, with net
sales of approximately EUR 8 million and operating profit slightly
less than EUR 1.0 million in 2022.
The estimated total consideration of EUR 4.9 million will be
paid fully in cash, and EUR 3.9 million has already been paid. The
rest of the consideration will be paid in the years 2024 and 2025
based on the earn-out clause of the purchase agreement. The assets
and liabilities of the acquired company were measured at fair value
on the acquisition date. A fair value adjustment of EUR 3.1 million
was made on intangible assets based on customer relationships,
non-compete clauses and trademarks, and the fair value adjustment
relating to inventories was EUR 0.1 million. The deferred tax
liability arising from the fair value adjustments was EUR 0.6
million. The carrying amount of the other acquired assets and
liabilities corresponded to their fair values. A goodwill balance
of EUR 1.3 million was recognized from the acquisition. The
acquisition-related costs of approximately EUR 0.4 million were
recognized in the Telko segment’s other operating expenses.
Preliminary acquisition calculation of Eltrex |
|
|
9/2023 |
|
MEUR |
Consideration |
|
Paid in
cash |
4.9 |
Total
consideration |
4.9 |
|
|
Assets
acquired and liabilities assumed, fair value |
|
Intangible
assets |
3.4 |
Leased
assets |
0.6 |
Inventories |
1.4 |
Accounts
receivable and other receivables |
1.1 |
Total
assets |
6.5 |
|
|
Interest
bearing liabilities |
1.3 |
Accounts
payable and other liabilities |
1.0 |
Deferred tax
liability |
0.6 |
Total
liabilities |
2.9 |
|
|
Net
assets acquired |
3.6 |
|
|
Goodwill |
1.3 |
Aspo Group disaggregation of net sales, from continuing
operations
Telko net sales |
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
Change |
1-9/2023 |
1-9/2022 |
Change |
1-12/2022 |
|
MEUR |
MEUR |
% |
MEUR |
MEUR |
% |
MEUR |
Business
area: |
|
|
|
|
|
|
|
Plastics
business |
26.5 |
26.5 |
0.0 |
77.8 |
82.0 |
-5.1 |
110.1 |
Chemicals
business |
14.9 |
12.3 |
21.1 |
46.7 |
36.6 |
27.6 |
49.2 |
Lubricants
business |
12.4 |
12.8 |
-3.1 |
37.8 |
36.5 |
3.6 |
50.1 |
Telko
total |
53.8 |
51.6 |
4.3 |
162.3 |
155.1 |
4.6 |
209.4 |
Leipurin net sales |
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
Change |
1-9/2023 |
1-9/2022 |
Change |
1-12/2022 |
|
MEUR |
MEUR |
% |
MEUR |
MEUR |
% |
MEUR |
Regions: |
|
|
|
|
|
|
|
Finland |
12.6 |
12.2 |
3.3 |
37.1 |
34.3 |
8.2 |
46.6 |
Sweden |
11.7 |
4.4 |
165.9 |
37.3 |
4.4 |
747.7 |
17.3 |
Baltics |
8.7 |
9.4 |
-7.4 |
27.2 |
26.8 |
1.5 |
36.8 |
Ukraine |
0.2 |
0.2 |
0.0 |
0.6 |
0.8 |
-25.0 |
0.9 |
Total |
33.2 |
26.2 |
26.7 |
102.2 |
66.3 |
54.1 |
101.6 |
of which: |
|
|
|
|
|
|
|
Bakeries |
24.4 |
19.4 |
25.8 |
75.0 |
49.2 |
52.4 |
74.9 |
Food
Industry |
2.9 |
3.1 |
-6.5 |
8.9 |
8.3 |
7.2 |
11.8 |
Retail,
foodservice, other |
5.9 |
3.7 |
59.5 |
18.3 |
8.8 |
108.0 |
14.9 |
|
|
|
|
|
|
|
|
Vulganus |
|
0.0 |
-100.0 |
|
4.3 |
-100.0 |
4.3 |
Leipurin total |
33.2 |
26.2 |
26.7 |
102.2 |
70.6 |
44.8 |
105.9 |
Net sales by timing of revenue recognition |
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
ESL
Shipping |
|
|
|
|
|
At a point in
time |
0.0 |
1.0 |
0.1 |
2.9 |
3.5 |
Over time |
43.0 |
64.0 |
139.6 |
179.2 |
241.9 |
|
43.0 |
65.0 |
139.7 |
182.1 |
245.4 |
|
|
|
|
|
|
Telko |
|
|
|
|
|
At a point in
time |
53.7 |
51.5 |
162.0 |
154.8 |
209.0 |
Over time |
0.1 |
0.1 |
0.3 |
0.3 |
0.4 |
|
53.8 |
51.6 |
162.3 |
155.1 |
209.4 |
|
|
|
|
|
|
Leipurin |
|
|
|
|
|
At a point in
time |
33.2 |
26.2 |
102.2 |
67.3 |
102.6 |
Over time |
0.0 |
0.0 |
0.0 |
3.3 |
3.3 |
|
33.2 |
26.2 |
102.2 |
70.6 |
105.9 |
|
|
|
|
|
|
Total |
|
|
|
|
|
At a point in
time |
86.9 |
78.7 |
264.3 |
225.0 |
315.1 |
Over time |
43.1 |
64.1 |
139.9 |
182.8 |
245.6 |
|
130.0 |
142.8 |
404.2 |
407.8 |
560.7 |
Net sales by market area |
|
|
|
|
|
|
|
|
7-9/2023 |
7-9/2022 |
1-9/2023 |
1-9/2022 |
1-12/2022 |
|
MEUR |
MEUR |
MEUR |
MEUR |
MEUR |
ESL
Shipping |
|
|
|
|
|
Finland |
23.5 |
32.8 |
70.2 |
88.9 |
121.5 |
Scandinavia
countries |
13.0 |
18.3 |
40.2 |
46.6 |
58.5 |
Baltic
countries |
0.0 |
0.5 |
0.4 |
2.4 |
2.9 |
Other European
countries |
5.9 |
11.9 |
21.0 |
37.3 |
48.2 |
Other
countries |
0.6 |
1.5 |
7.9 |
6.9 |
14.3 |
|
43.0 |
65.0 |
139.7 |
182.1 |
245.4 |
|
|
|
|
|
|
Telko |
|
|
|
|
|
Finland |
11.2 |
11.9 |
36.8 |
39.8 |
53.5 |
Scandinavia
countries |
14.6 |
15.4 |
42.1 |
47.6 |
61.7 |
Baltic
countries |
6.8 |
6.7 |
21.6 |
20.6 |
28.3 |
Other European
countries |
13.3 |
10.6 |
35.9 |
29.5 |
39.0 |
Other
countries |
7.9 |
7.0 |
25.9 |
17.6 |
26.9 |
|
53.8 |
51.6 |
162.3 |
155.1 |
209.4 |
|
|
|
|
|
|
Leipurin |
|
|
|
|
|
Finland |
12.6 |
12.2 |
37.1 |
37.1 |
49.4 |
Scandinavia
countries |
11.6 |
4.3 |
36.8 |
4.7 |
17.4 |
Baltic
countries |
8.6 |
9.4 |
27.1 |
26.7 |
36.6 |
Other European
countries |
0.4 |
0.3 |
1.2 |
2.0 |
2.4 |
Other
countries |
0.0 |
0.0 |
0.0 |
0.1 |
0.1 |
|
33.2 |
26.2 |
102.2 |
70.6 |
105.9 |
|
|
|
|
|
|
Total |
|
|
|
|
|
Finland |
47.3 |
56.9 |
144.1 |
165.8 |
224.4 |
Scandinavia
countries |
39.2 |
38.0 |
119.1 |
98.9 |
137.6 |
Baltic
countries |
15.4 |
16.6 |
49.1 |
49.7 |
67.8 |
Other European
countries |
19.6 |
22.8 |
58.1 |
68.8 |
89.6 |
Other
countries |
8.5 |
8.5 |
33.8 |
24.6 |
41.3 |
|
130.0 |
142.8 |
404.2 |
407.8 |
560.7 |
Investments by segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ESL Shipping |
Telko |
Leipurin |
Non-core |
Group |
MEUR |
|
|
|
businesses |
total |
Investments |
1-9/2023 |
10.8 |
0.7 |
0.1 |
0.1 |
11.7 |
Investments |
1-9/2022 |
14.3 |
0.7 |
0.1 |
0.0 |
15.1 |
Green Coaster investment commitment
AtoBatC Shipping AB, reported in the ESL Shipping segment, is
building a series of six highly energy-efficient electric hybrid
vessels. The new vessels of ice class 1A will be top of the line in
terms of their cargo capacity, technology and innovation. The total
value of the six-vessel investment is approximately EUR 70 million,
and its cash flows will be divided mainly for the years 2023 and
2024. The new vessels are built at the Chowgule and Company Private
Limited shipyard in India, and first of them, Electramar, is
expected to be delivered during the fourth quarter of 2023.
Segment assets and liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ESL Shipping |
Telko |
Leipurin |
Held for |
Unallocated |
Group |
MEUR |
|
|
|
sale |
items |
total |
Assets Dec 31, 2022 |
224.8 |
85.7 |
68.5 |
12.4 |
24.5 |
415.9 |
Assets Sep 30, 2023 |
233.4 |
78.7 |
59.9 |
3.8 |
34.9 |
410.7 |
|
|
|
|
|
|
|
|
Liabilities Dec 31, 2022 |
32.3 |
34.4 |
16.4 |
3.9 |
185.2 |
272.2 |
Liabilities Sep 30, 2023 |
32.0 |
46.9 |
20.7 |
1.1 |
163.5 |
264.2 |
Events after the review period
On October 20 Leipurin signed an agreement for a sale of its
bakery equipment business to Orat Oy. The transaction price is
approximately EUR 0.5 million and includes the business and related
inventory. Closing of the transaction requires certain approvals of
business partners and is expected to take place by the end of the
year. The divestment supports Leipurin’s strategy to be a focused,
Nordic ingredient and service company.
Helsinki, November 1, 2023Aspo PlcBoard of Directors
Press and analyst conference
A press, analyst and investor conference will be held at FLIK’s
Eliel studio in Sanomatalo, Töölönlahdenkatu 2, 00100 Helsinki on
Wednesday November 1, 2023, at 2 p.m. The event is also open to
private investors, and participants are requested to register
beforehand by emailing viestinta@aspo.com.
The interim report will be presented by CEO Rolf Jansson. The
presentation material will be available at www.aspo.com/en before
the event.
The event will be held in English, and it can also be followed
by a live webcast at https://aspo.videosync.fi/q3-2023. Questions
can be asked after the event by telephone by registering through
the following link:
http://palvelu.flik.fi/teleconference/?id=1009759. After
registering, participants will be given a telephone number and
identifier to participate in the telephone conference. The
recording of the event will be available on the company’s website
later on the same day.
Helsinki, November 1, 2023Aspo Plc
Rolf Jansson |
|
Arto
Meitsalo |
|
CEO |
|
CFO |
|
For more information, please contact:Rolf Jansson, CEO, Aspo
Plc, tel. +358 400 600 264, rolf.jansson@aspo.com
Distribution:Nasdaq HelsinkiKey
mediawww.aspo.comAspo creates value by owning
and developing business operations sustainably and in the long
term. Our companies aim to be market leaders in their sectors. They
are responsible for their own operations, customer relationships
and the development of these aiming to be forerunners in
sustainability. Aspo supports its businesses profitability and
growth with the right capabilities. Aspo Group has businesses in 18
different countries, and it employs a total of approximately 800
professionals.
- Aspo Group Interim Financial Report, January 1 to September 30,
2023
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