Slide 1: Annual Accounts 2007
Annual Accounts 2007 February 5, 2008 Slide 1
Slide 2: Agenda
AGENDA • Q4 and 2007 in Brief • Business Organisation – Latest Changes • Sales Analysis • Profitability Analysis • Cash flow & Working Capital • Strategy Implementation • Outlook for 2008 • Rapala share performance and owners Slide 2
Slide 3: Q4 and 2007 in Brief
Q4 AND 2007 IN BRIEF EUR million IV/07 IV/06 2007 2006 Sales 53.7 49.2 242.5 226.6 EBITDA 4.3 2.4 33.8 28.0 Operating Profit (EBIT) 2.4 0.7 28.3 21.7 Profit Before Taxes 1.1 -0.3 23.3 14.6 Net Profit for the Period 2.0 0.5 17.5 11.0 EPS (basic), EUR 0.05 0.01 0.45 0.28 Equity-to-assets, % 38.2 33.4
Slide 4: Group Organization & Cornerstones of Strategy
Group Organization & Cornerstones of Strategy USA FINLAND ESTONIA CANADA SWEDEN POLAND Distribution RUSSIA (50/50) ITALY REST OF EUROPE JAPAN DENMARK LITHUANIA MALAYSIA BRAZIL GERMANY NORWAY LATVIA REST OF WORLD UKRAINE (50/50) NETHERLAND AUSTRALIA FRANCE CZECH REPUBLIC S CHINA HUNGARY (57/33/10) BE
Slide 5: Location of Business Operations – Latest Updates
Location of Business Operations – Latest Updates Latest additions (07): - Lure factory in Russia - Terminator lures in USA - LJS painting shop in US - New sales co in S-Korea - Shimano sales in S-EE 2006 additions: - Shimano 33,4% in S-EE - T&P sales co in S-Africa - Rapala-Shimano 50/50 JV - Tortue
Slide 6: Restructuring of European Operations
Restructuringof EuropeanOperations Marttiini z Consolidation of French operations z Knife manufacturing - Move from Bretagne completed z 80 employees in - Move from Central France in mid-2008 Rovaniemi & Pärnu - New Morvillars distribution premises in use z Development of lure manufacturing Vääksy -
Slide 7: Enhancement of Chinese Manufacturing Operations
Enhancementof ChineseManufacturingOperations z Major operational changes and improvements to enhance production efficiencies and shorten lead times z International task force established to support the development of manufacturing and supply chain management in China Guangzhou Shenzhen z Rapala sour
Slide 8: Competition and Major Players in the Industry
Competition and Major Players in the Industry Company Worldwide Major product categories Comments sales MUSD* Jarden 450 Rods, reels, combos, line, soft plastics US sales ca. 60% of sales Pure Fishing + Shakespeare Daiwa 450 Rods, reels, lures Japan ca. 80% of total sales Shimano 380 Rods, reels, ac
Slide 9: Financial Position Healthy – Fuelled for Growth
Financial Position Healthy – Fuelled for Growth ¾ Rapid growth in last few years from €100m to above € 240m. ¾ The promised turnaround in operating margin was delivered in 2007. ¾ Continuous growth, improving profitability, strong balance sheet & cash flow. 250 18 % 140 800 % 16 % 700 % 120 200 14 %
Slide 10: Net Sales Analysis
NET SALES ANALYSIS Net sales 2007 were up 7%, an all 250 time record 242.5 MEUR (226.6). 200 Q4 sales up 9% to 53.7 MEUR (49.2). Increase from Rest of Europe and 150 MEUR Rest of World. Sales growth strongest 100 in new markets. US sales affected 5.8 MEUR negatively by fx-rate. 50 All produc
Slide 11: Operating Profit Analysis (1)
OPERATING PROFIT ANALYSIS (1) Operating profit increased 30% to 30 14,0 % 28.3 MEUR (21.7 MEUR). 25 12,0 % Increased labor & raw materials 10,0 % costs especially in China & weakening 20 8,0 % MEUR of USD and some other currencies 15 (-1.6 MEUR) slowed down the increase 6,0 % of operating profit
Slide 12: Operating Profit Analysis (2)
OPERATING PROFIT ANALYSIS (2) Management Analysis 2007 2006 2007 2006 Net sales as reported 242.5 226.6 Operating profit as reported 28.3 21.7 Foreign exchange effects 10.0 0.0 Non-recurring items (net) -1.6 0.4 Comparable net sales 252.5 226.6 Foreign exchange effects 1.6 0.0 Comparable operating p
Slide 13: Cash Flow and Working Capital
CASH FLOW AND WORKING CAPITAL STATEMENT OF CASH FLOWS IV IV I-IV I-IV EUR million 2007 2006 2007 2006 Net profit for the period 2.0 0.5 17.5 11.0 Adjustments -2.4 -0.7 3.7 7.1 Change in working capital 0.2 0.2 -3.1 -8.1 Net cash from operating activities -0.3 -0.1 18.2 10.0 Net cash used in investin
Slide 14: Strategy Implementation – Growth
STRATEGY IMPLEMENTATION – GROWTH ¾ In 2007 management continued discussions and negotiations regarding acquisitions and business combinations to implement the Group’s strategy for profitable growth. ¾ These discussions resulted in a major business combination when Rapala and Shimano agreed to establ
Slide 15: Strategy Implementation – Profitability
STRATEGY IMPLEMENTATION – PROFITABILITY ¾ Increasing focus on performance improvement initiatives continued with the target to turn around the declining trend in operating profit margin. ¾ Consolidation of French operations into one location proceeds on plan. New premises are operational and move of
Slide 16: Outlook for 2008
OUTLOOK FOR 2008 – Outlook for 2008 is quite good. No major changes expected in the markets. – Expected that Group’s net sales for 2008 will increase 8-12% with comparable fx-rates. – Possible additional acquisitions during 2008 would further increase the sales. – The profitability of the Group’s on
Slide 17: Share Price Performance
Share Price Performance Share Related Data (12/2007) Share price performance for last 3 months ¾ Market Cap 219 MEUR ¾ 12-month high 6.27 EUR ¾ 12-month low 5.40 EUR ¾ All-time high 8.40 (2/99) ¾ All-time low 2.50 (11/01) Major Shareholders Share price performance for 2003-2007 (5 years) ¾ VMC 27 %
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