Slide 1: Q2 Interim Report 2008
Q2 Interim Report 2008 July 23, 2008 Slide 1
Slide 2: Content
Content • Q2 in Brief • Business Organisation • Status of Performance Improvement p Initiatives • Sales Analysis • Profitabilityy Analysis y • Cash flow & Working Capital • Strategy gy Implementation p • Outlook for 2008 • Financial Trend Historyy for Rapala p • Rapala Share Performance and Major Sh
Slide 3: Q2 in Brief
Q2 in Brief EUR million II/2008 II/2007 I-II/2008 I-II/2007 2007 Sales 74.2 73.4 139.4 136.8 242.5 EBITDA 15.4 12.6 27.6 24.9 33.8 Operating Profit (EBIT) 13.8 11.0 24.5 23.0 28.3 Profit Before Taxes 12 8 12.8 98 9.8 22 1 22.1 20 8 20.8 23 3 23.3 Net Profit for the Period 9.4 6.7 16.2 14.4 17.5 EPS
Slide 4: Group Organization & Cornerstones of Strategy
Group Organization & Cornerstones of Strategy USA FINLAND ESTONIA CANADA SWEDEN POLAND RUSSIA (50/50) stribution ITALY REST OF EUROPE JAPAN DENMARK LITHUANIA MALAYSIA UKRAINE (50/50) GERMANY BRAZIL NORWAY LATVIA REST OF WORLD AUSTRALIA HUNGARY (57/33/10) NETHERLAND FRANCE SLOVAKIA S BELGIUM CHINA SP
Slide 5: Restructuring of European Operations
Restructuring of European Operations Consolidation of French operations Marttiini - Move from Bretagne completed - Move from Central France in Q3 2008 Knife manufacturing - Move of VMC Europe in Q4 or 2009 80 employees in - 1st real estate sold (gain of 1.2 MEUR) Rovaniemi & Pärnu Developmen
Slide 6: Enhancement of Chinese Manufacturing
Enhancement of Chinese Manufacturing Major operational changes and improvements to enhance production efficiencies and shorten lead times & physical split of fishing tackle & gifts International task force established to s support pport the de development elopment initiati initiatives. es Phys
Slide 7: Competition & Major Players in the Industry
Competition & Major Players in the Industry - No major changes in the competitive environment in Q2 Company Worldwide Major product categories Comments sales MUSD Jarden 450** Rods, reels, combos, line, soft US sales ca. 50% of sales Pure Fishing + plastics Shakespeare Shimano 430* Rods, reels, acce
Slide 8: Net Sales Analysis
Net Sales Analysis • Q2 started well in main markets. . • Consumer demand under pressure as 80,0 economic climate continued to weaken in 60,0 few European countries and especially USA MEUR • Strong East Europe boosted the sales in 40,0 M R t off Europe Rest E to t growth. th 20,0 • Nordic sales up w
Slide 9: Operating Profit Analysis (1)
Operating Profit Analysis (1) Q2 operating profit up to 13.8 MEUR (11.0). H1 operating p gp profit up p to 24.5 MEUR ((23.0). ) 15,0 , H1 operating margin up to17.6% (16.8%) 12,0 MEUR and ROCE to 25.9% (24.7%). 9,0 Performance improvement initiatives started 60 6,0 M to capitalize 3,0 H1 r
Slide 10: Operating Profit Analysis (2)
Operating Profit Analysis (2) Management Analysis I-II/2008 I-II/2007 I-II/2008 I-II/2007 Net sales as reported 139.4 136.8 Operating profit as reported 24.5 23.0 Foreign exchange effects 7.7 - Non-recurring items (net) -0.7 -1.3 Comparable net sales 147.1 136.8 Foreign exchange effects 0.8 - p Comp
Slide 11: Cash Flow and Working Capital
Cash Flow and Working Capital EUR million II/2008 II/2007 I-II/2008 I-II/2007 I-IV/2007 Net profit for the period 94 9.4 67 6.7 16 2 16.2 14 4 14.4 17 5 17.5 Adjustments 3.7 5.8 8.7 10.5 14.8 Financial items and taxes paid/rec -3.5 -2.3 -6.3 -4.2 -11.1 Change in working capital -3.4 3.4 -28.7 -14.4
Slide 12: Strategy Implementation - Profitability
Strategy Implementation - Profitability Emphasis on performance improvement initiatives continued in Q2 with a target to further improve the Group’s profitability in 2008. Consolidation C lid ti off ththe F Frenchh operation ti proceededd d on plan. l S l off the Sale th fifirstt reall estate t
Slide 13: Strategy Implementation - Growth
Strategy Implementation - Growth In Q2, Rapala continued to develop its product portfolio and market coverage to implement its strategy for profitable growth. Discussions and negotiations regarding acquisitions and business combinations continued. The most important action in this respect, res
Slide 14: Strategy Implementation – Sufix Acquisition
Strategy Implementation – Sufix Acquisition On July 10, Rapala acquired from Yao I Co ltd the Sufix fishing line brand and concluded an exclusive supply agreement including also OEM business. Sufix brand is a very well know brand around the world for more than 20 years. Yao I, established in 1
Slide 15: Outlook for 2008
Outlook for 2008 – Market outlook for 2008 looks challenging. – Slowdown in the US economy is expected to affect the sales in North A America. i – Q3 traditionally a slow period for fishing tackle business and increase of other products, especially hunting and towards the end of Q3 also winter sport
Slide 16: Financial Position Healthy - Fuelled for Growth
Financial Position Healthy - Fuelled for Growth • Rapid growth in last few years from €100m to above € 240m. • Promised turnaround in operating margin delivered in 2007. • Positive development in operating margin expected for 2008 vs. 2007 250 18 % 140 800 % 225 16 % 120 700 % 200 14 % 600 % 175 100
Slide 17: Share Price Performance & Shareholders
Share Price Performance & Shareholders Share Related Data (6/2008) Share price for the last 12 months Market M k t Cap C 160 MEUR 12-month high 6.06 EUR 12-month low 3.85 EUR All-time high 8.40 (2/99) All-time low 2.50 (11/01) Major Shareholders VMC 27 % Share price performance 6/2003-6/
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