As filed with the Securities and Exchange Commission on May 30, 2002
FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
Results for the three months ended March 31, 2002
DYNEA INTERNATIONAL OY
13 Snellmaninkatu, Helsinki, Finland
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F
Form 20-F |X| Form 40-F |_|
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
Yes |_| No |X|
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
N/A
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DYNEA INTERNATIONAL OY
By: /s/ Filip Frankehaeuser
------------------------
Name: Filip Frankehaeuser
Title: Chief Financial Officer
Date: May 30, 2002
Management discussion and analysis
This discussion and analysis should be read together with the combined and
consolidated financial statements of Dynea International, and the notes related
to those financial statements.
Some statements in this discussion are not historical facts and are
"forward-looking." Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause our actual results,
performance or achievements or industry results to be materially different from
those expressed or implied by those forward-looking statements. A discussion of
important factors that could cause our actual results of operations or financial
condition to differ from expectations has been set forth in the prospectus and
should be read in conjunction with this discussion. In addition, other factors
may have been or may be discussed from time to time in our published reports.
Our results for the period from January 1, 2002 to March 31, 2002 are not
necessarily indicative of results that will be achieved during the year ending
December 31, 2002.
The segments listed below are described in this MD&A:
Bonding & Surfacing consists of Dynea International's bonding and surfacing
manufacturing operations, which includes resins, wood and specialty adhesives
and paper overlay products.
Oil Field Chemicals includes oil field chemical production operations for
chemicals that are used to facilitate oil production and transportation.
Other Operations includes several small non-core operations such as a polyvinyl
chloride manufacturing plant in Finland, and certain corporate functions and
treasury operations. These results also include Det Gjensidige
Forsikringsselskap Explosionskade ("DGFE"), a captive insurance company, that
insures Dyno and affiliated companies primarily for risks related to its
explosives business. This captive insurance company is in the process of being
liquidated and its operations are no longer significant to Dynea International.
Operations that have been sold
Polyester consisted of Dynea International's unsaturated polyester resins and
gelcoat manufacturing operations, which customers use in the building and
construction, land transport and marine industries. These operations were sold
in April 2001.
Operating results for the three months period ended March 31, 2002 compared to
operating results for the three month period ended March 31, 2001
The financial data for the three month period set out below are derived from
Dynea International's consolidated profit and loss accounts for that period.
These historical financial statements were prepared in accordance with IAS.
3 months ended 3 months ended
March 31, 2002 March 31, 2001
(euro millions)
Sales
Bonding & Surfacing........................ 213.0 241.6
Oil Field Chemicals........................ 18.9 14.7
Other Operations........................... 6.3 6.8
Operations That Have Been Sold............. 0.0 31
-------------- --------------
Total...................................... 238.2 294.1
Primary Operating Expenses(1)
Bonding & Surfacing........................ 188.1 220.4
Oil Field Chemicals........................ 17.0 13.2
Other Operations........................... 7.4 8.8
Operations That Have Been Sold............. 0.0 28.4
-------------- --------------
Total...................................... 212.5 270.8
EBITDA(2)
Bonding & Surfacing........................ 24.9 21.2
Oil Field Chemicals........................ 1.9 1.5
Other Operations........................... -1.1 -1.9
Operations That Have Been Sold............. 0.0 2.5
-------------- --------------
Total...................................... 25.7 23.3
Depreciation and Amortization
Bonding & Surfacing........................ 9.4 10.0
Oil Field Chemicals........................ 0.3 0.2
Other Operations........................... 3.9 3.7
Operations That Have Been Sold............. 0.0 1.2
-------------- --------------
Total...................................... 13.6 15.1
Restructuring and Impairment
Bonding & Surfacing........................ 0.0 0.1
-------------- --------------
Total...................................... 0.0 0.1
Operating Profit
Bonding & Surfacing........................ 15.5 11.1
Oil Field Chemicals........................ 1.6 1.3
Other Operations........................... -5.0 -5.6
Operations That Have Been Sold............. 0.0 1.3
-------------- --------------
Total...................................... 12.1 8.1
Finance Costs.............................. 12.9 20.1
Shares of Results of Associates and Joint
Ventures................................ -1.1 5.2
Income Tax Expense......................... 1.4 1.7
Minority Interest Expense.................. 0.9 0.6
Net Loss -4.2 -9.1
============== ==============
(1) Primary operating expenses represent changes in inventories of
finished goods and work in progress, raw materials and consumables used,
services and rents, staff costs, and other operating expense, offset by
other operating income less restructuring and impairment charges.
(2) EBITDA, as defined by the company, represents operating income
excluding restructuring and impairment charges and depreciation and
amortization charges. Because EBITDA is not calculated identically by all
companies the presentation herein may not be comparable to other
similarly titled measures of other companies.
Note: for reference quarterly sales and operating profit for the year 2001 for
the segment Oil Field Chemicals
3 months ended June 30, 2001 September 30, 2001 December 31, 2001
Sales (euro)15.8 (euro)16.2 (euro)19.9
Operating profit (euro)1.7 (euro)1.2 (euro)1.3
Sales
Sales for Dynea International decreased 19% in the first quarter of 2002 to
(euro)238.2 million from (euro)294.1 million in the first quarter of 2001.
Bonding and Surfacing
Sales from bonding and surfacing decreased 12% to (euro)213.0 million in the
first quarter 2002 from (euro)241.6 million in the first quarter of 2001. Sales
volumes for resins products compared to the same period last year remained
essentially constant (decreased by 0.4%). For paper overlay products volumes
increased 3%. The decrease in sales value is attributable to the fact that
prices for our resin products were lower in the first quarter of 2002 than in
the first quarter of 2001 due to lower raw material prices, which we were
required to pass on to our customers. In North America the demand for panelboard
resin products improved in the first quarter of 2002, and consequently volumes
increased. Although the price for our resin products decreased in North America,
margins were maintained at the same level as in first quarter 2001. In Europe,
the downturn in the German construction industry continues and thus our volumes
in this market decreased during the first quarter of 2002. In Asia Pacific,
sales and volume development declined slightly compared to the previous
corresponding period, but we have been able to maintain prices at levels closer
to those charged when raw material prices were higher.
Oil Field Chemicals
Sales from oil field chemicals increased 29% to (euro)18.9 million in the first
quarter of 2002. A substantial part of this increase is due to the fact that
during the first quarter of 2001 there were accidents at two main customer sites
that reduced orders for our oil field chemicals products. It is further
attributable to increased deliveries on our European market for the first
quarter of 2002.
Other operations
Sales in other operations result mainly from the operations of the PVC
manufacturing plant, and there was no significant change within this segment,
sales value for the first quarter of 2002 was (euro)6.3 million compared to
(euro)6.8 million for the first quarter of 2001.
Operations that have been sold
Sales decreased to nil from (euro)31 million, due to sale of our polyester
business in April 2001.There are no businesses reported in this segment during
the first quarter 2002.
Operating profit
Bonding and Surfacing
Operating profit for this segment increased 40% to (euro)15.5 million from
(euro)11.1 million.
This increase is mainly attributable to the decrease in operating expenses
during this period; they decreased 15%, to (euro)188.1 million from (euro)220.4
million. Main raw material prices for these products (methanol, phenol, urea and
melamine) have decreased substantially. Average methanol prices have decreased
50% and the others between 10 and 30% when comparing the first quarter of 2001
to the same period in 2002. During the whole year of 2001 the raw material
prices showed a decreasing trend and reached their lowest point during the
fourth quarter. The prices we charge under our contracts are often subject to an
adjustment on a periodic basis based on raw material costs, but also on general
market condition. In North America and Asia Pacific, we were able to delay
passing on these raw material price decreases to our customers, and so margins
and also performance in the first quarter 2002 was higher. In Europe, the highly
competitive nature of the market has required that we pass on raw material
prices to our customers quickly, which has reduced our margins from sales in
Europe. Although these margins are recovering from the very low levels
experienced during 2001, the level in 2002 is not yet satisfactory. We have
however managed to gain benefits from our internal actions to increase
efficiency and thus operating profit in Europe also increased as compared to the
first quarter 2001.
Depreciation and amortization charges were at the same level as previous year
for the same period.
There were no restructuring expenses during first quarter of 2002.
Oil Field Chemicals
Operating profit for oil field chemicals increased 23% to (euro)1.6 million from
(euro)1.3 million in the same period last year.
Operating expenses increased 28% to (euro)17 million from (euro)13.2 million
mainly due to the increase in sales. As margin level remained essentially
constant this gave rise to an increase in operating profit.
Other operations
Operating profit associated with other operations increased 11%, to a loss of
- -(euro)5 million from a loss of -(euro)5.6 million. Operating expenses during
the same period decreased, mainly due to the full effect of savings achieved
through restructuring efforts implemented in late 2000 and during 2001.
Depreciation and amortization charges decreased with 5% and were (euro) 3.7
million at the end of the first quarter 2002. Amortization of goodwill for the
first quarter of 2002 was (euro)3.6 million compared to (euro)3.7 million in
first quarter of 2001.
Operations that have been sold
Operating profit decreased to nil from (euro)1.3 million, due to sale of our
polyester business in April 2001.There are no businesses reported in this
segment during the first quarter 2002.
Finance cost
Three-Month Period from
January 1 to March 31
(euro millions)
2002 2001
12.9 20.1
Finance costs decreased 36% to (euro)12.9 million from (euro)20.1 million.
Net interest expense in the period was (euro)15.6 million compared to (euro)20.0
million in the same period last year. Net interest expense reduction of
(euro)4.4 resulted mainly from repayment of senior bank loans with proceeds from
the sale of our polyester business. The rest of the reduction in Finance costs,
(euro)2.7 million, is attributable to Other financial expense with a positive
impact of foreign exchange differences totaling (euro)4.2 million and a negative
impact from other financial expense (net) of (euro) 1.6 million, mainly a result
of early amortization of capitalized loan arrangement fees.
Share of results in associates and joint ventures
Three-Month Period from
January 1 to March 31
(euro millions)
2002 2001
-1.1 5.2
Share of results in associates and joint ventures decreased to a loss of
- -(euro)1.1 million from a profit of (euro)5.2 million. This result is mainly
attributable to our 40% investment in the Methanor v.o.f. joint venture. There
has been a significant reduction in methanol prices since first quarter of 2001
and this has resulted in weaker performance for Methanor v.o.f.
Income tax expense
Three-Month Period from
January 1 to March 31
(euro millions)
2002 2001
1.4 1.7
Income tax was essentially stable in the first quarter of 2002 as compared to
the first quarter of 2001.
Minority interest expense
Three-Month Period from
January 1 to March 31
(euro millions)
2002 2001
0.9 0.6
Minority interest expense increased to (euro)0.9 million in the first quarter of
2002 from (euro)0.6 million in the first quarter of 2001. This increase was
mainly due to good performance for our Asian majority owned companies.
Net loss
Three-Month Period from
January 1 to March 31
(euro millions)
2002 2001
-4.2 -9.1
Net loss decreased 54% to a loss of -(euro)4.2 million in first quarter of 2002
from a loss of -(euro)9.1 million in first quarter of 2001. This was
attributable to the higher operating profit and lower financial expenses, offset
by the lower share of result in associates and joint ventures and higher
minority interest expense.
Liquidity and financial condition
In the first quarter of 2002 liquidity remained largely at the same level as at
the end 2001. Working capital increased during the quarter by (euro)13.1 million
and we received an equity contribution of (euro)7 million from our owners in
March.
Cash level was reduced from the end of 2001, due to the fact that we made the
two remaining prepayments of senior long-term loans for (euro)12.0 from the
proceeds received from the sale of our Polyester business.
During the first quarter of 2002 we also repaid (euro)2.3 million short-term
loans that we had drawn from our (euro)100 revolving credit facility during the
first quarter. Consequently at March 31, 2002, we had a total of (euro)94.2
million outstanding under the (euro)100 million revolving credit facility,
consisting of (euro)84.2 million short-term loans and (euro)10.0 million
guarantees and letters of credit. We also made (euro)22.8 million interest
payments in the first quarter, including a (euro)15.3 million interest payment
under the senior notes.
Liquidity has continued to improve in the beginning of the second quarter of
2002 and we have repaid a further (euro)4.8 million in short-term loans under
the revolver in April and (euro)5.0 million in May.
We were in compliance with all financial undertakings (covenants) under our
senior credit agreement for the 12 month period ending March 31, 2002.
At the end of March, our net debt stood as follows:
March 31,2002 December 31, 2001
(euro millions)
Gross debt, nominal value 661.0 668.7
Capitalised fees -26.8 -28.0
Gross debt, carrying value 634.0 640.7
Cash 45.0 59.5
Marketable securities 1.7 1.7
Net Debt 587.3 579.5
Capital Expenditures
Capital expenditures during the first quarter of 2002 were (euro)2.7 million.
This expenditure was mainly for replacement investments at several sites.
Quantitative and Qualitative Market Risk Disclosure
Financial Risk Management
Our business operations give rise to market risks exposure due to changes in
foreign exchange and interest rates. Also our high level of debt exposes us to
the changes in interest rates. To manage these risks, we enter into hedging
transactions and generally use derivative financial instruments, pursuant to
established guidelines and policies, which enable us to mitigate the adverse
effects of financial market risk. These hedging instruments are classified in a
manner consistent with the item being hedged, meaning that the associated asset
and liability items are marked-to-market at each balance sheet date through
current period earnings.
We do not anticipate any material adverse effect on our consolidated position,
result of operations, or cash flows, resulting from the use of derivative
financial instruments. We cannot guarantee, however, that our hedging strategies
will be effective, or that translation losses can be minimized or forecasted
accurately.
Foreign Exchange Risk and Interest Rate Risk
Our operations are conducted by many entities in many countries, and
accordingly, our results of operations are subject to currency transaction risk
and currency translation risk. Dynea's historical results were particularly
affected by exchange rate fluctuations between the euro and other currencies,
such as the U.S. dollar, the Norwegian kroner, the Canadian dollar and the
Swedish krona and by exchange rate fluctuations between the Norwegian kroner
against other currencies, such as the U.S. dollar. Foreign exchange exposures
are managed against various local currencies, as we have a significant amount of
worldwide production and sales.
Because we have global investments, production facilities and other operations,
we have assets and liabilities and cash flows in currencies other than the euro.
The equity changes caused by movements in foreign exchange rates are shown as
translation difference in our financial statements. We hedge our exposures on a
net exposure basis using foreign currency forward contracts. Dynea
International's main exposures are related to assets and liabilities denominated
in the currencies of the United States, Norway and Canada. Our businesses
includes a large portion of cross border and other sales incurring foreign
exchange transaction risks, as well as raw material sourcing and other costs in
various currencies. Our main adhesive resin business sales are, however, largely
conducted within a limited geographic area near our production sites, which
somewhat limits our foreign exchange transaction exposures.
Our main objective of interest rate risk management will continue to be to
reduce our total funding cost and to alter the interest rate exposure to the
desired risk profile. Under the terms of the senior credit agreement, we are
required to hedge at least 50% of the aggregate amount of the senior term loans
through interest rate protection agreements for a period of at least three
years. We have historically primarily borrowed in the euro, U.S. dollar,
Canadian dollar, Norwegian kroner and Swedish krona, among other currencies. Our
historical policy was to hedge approximately 50% of borrowings against future
movements in interest rates.
Interest Rate Exposure
As of March 31, 2002, Dynea International had (euro)317.6 million in syndicated
long-term variable rate debt, of which (euro)187.2 million was hedged through
LIBOR-based participating swaps that had a remaining average life of
approximately 1 year. These swaps effectively hedge for 50% interest rate change
until the defined capped rate of interest, after which the hedge is 100%. Capped
interest rates for Norwegian kroner, Canadian dollar and euro were 8%, 7% and
5%, respectively. In addition, Dynea International has U.S. dollar denominated
caps with 2 different capped interest rates. One contract with nominal value of
$10 million has a capped rate of 7.50% and the other contract with a nominal
value of $30.5 million has a capped rate of 7.25%. An interest rates average
increase of 25 basis points would cause Dynea International's annual interest
expense to increase about (euro)0.5 million, with those interest rates being
below the capped rates of interest.
Interest rate swaps involve the exchange of floating for fixed rate interest
payments to effectively convert floating rate debt into fixed rate debt. The
fair value of Dynea International's interest rate derivatives outstanding as of
March 31, 2002 and March 31, 2001 were -(euro)3.1 and -(euro)2.6 million,
respectively.
Interest Rate Swaps Notional
Amount Maturity
---------------- ------------------------------
(euro millions)
Variable to Fixed:
Norwegian kroner ..... 39.7 October 2003
Euro ................. 14.3 December 2002
U.S. dollar .......... 92.8 December 2002 / January 2003
Canadian dollar ...... 40.4 December 2002 / January 2003
Short-term loans also involve interest rate risk. The Company mainly borrows
under revolving credit facility to cover working capital and other needs. The
balance of revolving credit facility was (euro)84.2 million as of March 31,
2002.
Foreign Currency Exchange Rate Exposure.
At March 31, 2002, Dynea International had foreign exchange contracts
outstanding in various currencies. Dynea International's primary net foreign
currency exposures at March 31, 2002 included U.S. dollar, Norwegian kroner and
Canadian dollar. Consistent with the nature of the economic hedge of such
foreign currency exchange contracts, decreases or increases of the underlying
instrument or transaction being hedged would offset the corresponding unrealized
gains or losses, respectively. The fair value of Dynea International's foreign
exchange forward contracts that were outstanding as of March 31, 2002 and March
31, 2001, were -(euro)3.1 and -(euro)7.4 million, respectively.
Dynea International Oy
1st Quarter 2002
Dynea International Oy and Subsidiaries
Consolidated condensed income statement
(unaudited)
(all amounts in(euro)millions ) 3 months ended 3 months ended 12 months ended
March 31,2002 March 31,2001 December 31,2001
Sales 238.2 294.1 1,049.6
Other operating income 3.1 3.0 11.3
Expenses 215.6 273.8 985.9
Depreciation and Amortization 13.6 15.1 56.5
Restructuring and other related items 0.1 3.2
----------------------------------------------------------
Operating profit 12.1 8.1 15.3
Finance costs
Interest expense, net -15.6 -20.0 -73.7
Other financial expense 2.7 -0.1 -6.5
Total finance costs -12.9 -20.1 -80.2
Share of result of associates and joint ventures -1.1 5.2 9.7
----------------------------------------------------------
Loss before income tax and minority
interests -1.9 -6.8 -55.2
Income tax benefit (expense) -1.4 -1.7 7.6
Minority interests -0.9 -0.6 -2.4
----------------------------------------------------------
Net loss -4.2 -9.1 -50.0
==========================================================
Dynea International Oy and Subsidiaries
Consolidated condensed balance sheet
(unaudited)
(all amounts in(euro)millions )
As at March 31, As at March 31, As at December
2002 2001 31, 2001
ASSETS
Non-current assets
Intangible assets 265.8 273.8 269.2
Property, plant and equipment 453.3 505.1 457.3
Investments in associates and joint ventures 38.7 48.1 39.3
Other non-current assets 3.0 51.2 3.0
-------------------------------------------------------
760.8 878.2 768.8
Current assets
Inventories 75.3 100.0 73.5
Receivables 154.7 181.8 148.6
Other current assets 12.2 101.9 13.0
Cash and cash equivalents 45.0 44.5 59.5
-------------------------------------------------------
287.2 428.2 294.6
Total assets 1,048.0 1,306.4 1,063.4
=======================================================
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders equity
Share capital 288.0 281.0 281.0
Retained deficit -124.6 -100.5 -108.3
-------------------------------------------------------
163.4 180.5 172.7
Minority interests 11.4 9.0 10.0
Non-current liabilities
Borrowings 524.2 626.5 517.5
Other non-current liabilities 86.3 116.1 87.0
-------------------------------------------------------
610.5 742.6 604.5
Current liabilities
Borrowings and current portion of long-term debt 109.8 99.6 121.7
Accounts payable 87.7 119.5 82.9
Other current liabilities 65.2 155.2 71.6
-------------------------------------------------------
262.7 374.3 276.2
Total liabilities 873.2 1,116.9 880.7
Total equity and liabilities 1,048.0 1,306.4 1,063.4
=======================================================
Dynea International Oy and Subsidiaries
Consolidated condensed cash flow statement
(unaudited)
(all amounts in(euro)millions )
3 months ended 3 months ended 12 months ended
March 31,2002 March 31,2001 December 31,2001
Cash flow from operating activities
Net loss -4.2 -9.1 -50.0
Adjustments, total 29.9 32.3 135.3
Net profit before change in net working capital 25.7 23.2 85.3
Change in net working capital -13.1 -29.4 37.4
Cash generated from operations 12.6 -6.2 122.7
Interest received 0.4 1.3 11.4
Interest paid -22.8 -29.8 -87.5
Other financial income and expense 0.5 -1.5 -9.4
Income tax refund /(taxes paid) 0.5 0.6 -36.9
Net cash (used in) provided by operating activities -8.8 -35.6 0.3
Acquisitions
Disposals of businesses 1.9 67.2
Purchase of property, plant and equipment -2.6 -5.1 -28.9
Other investing cash flow, net 1.0 7.8
-----------------------------------------------------
Net cash used in investing activities -2.6 -2.2 46.1
Issuance of share capital/capital contribution 15.2 4.5 34.5
Net proceeds from borrowings -19.3 37.6 -61.8
-----------------------------------------------------
Net cash provided by ( used in) financing activities -4.1 42.1 -27.3
(Decrease)/ Increase in cash and cash equivalents -15.5 4.3 18.8
Movement in cash and cash equivalents
At start of the interim period 59.5 40.2 40.2
Effect of exchange rates 1.0 0.2
Decrease/increase -15.5 4.3 19.1
-----------------------------------------------------
At end of the interim period 45.0 44.5 59.5
=====================================================
Consolidated condensed statement of changes in equity
Issued and Paid Issued but not Paid Retained Cumulative
Share capital Share Capital deficit Translation Total
difference
Balance at 1 January 2001 276.5 4.5 -71.5 -9.5 200.0
Transfers 4.5 -4.5
Translation adjustment -10.4 -10.4
Net loss -9.1 -9.1
------------------------------------------------------------------------------------
Balance at 31 March 2001 281.0 0.0 -80.6 -19.9 180.5
Balance at 1 January 2002 281.0 0.0 -83.3 -25.0 172.7
Shares issued 7.0 7.0
Translation adjustment -12.1 -12.1
Net loss -4.2 -4.2
------------------------------------------------------------------------------------
Balance at 31 March 2002 288.0 0.0 -87.5 -37.1 163.4
Dynea International Oy and Subsidiaries
Notes to interim consolidated condensed financial statements
1. Accounting policies
These unaudited interim consolidated condensed financial statements are prepared
in in accordance with International Accounting Standard 34 Interim Financial
Reporting. The accounting policies used in the preparation of the interim
financial statements are consistent with those used in the Company's
consolidated financial statements for the year ended December 31, 2001.
Income tax expense is recognised based on the best estimate of the weighted
average annual income tax rate expected for the full financial year.
2. Segment information
(unaudited)
(all amounts in(euro)millions)
3 months ended 3 months ended 12 months ended
March 31,2002 March 31,2001 December 31,2001
Sales
Bonding & Surfacing 213.0 241.6 915.9
Oil Field Chemicals 18.9 14.7 66.6
Other operations 6.3 6.8 25.0
Operations that have been sold 0.0 31.0 42.1
------------------------------------------------------------------------------
Total sales 238.2 294.1 1049.6
Operating profit
Bonding & Surfacing 15.5 11.1 37.6
Oil Field Chemicals 1.6 1.3 5.5
Other operations -5.0 -5.6 -24.5
Operations that have been sold 0 1.3 -3.3
------------------------------------------------------------------------------
Total 12.1 8.1 15.3
In 2001 the reported sales and operating profit in respect of operations that
have been sold also
includes the Polyester segment that has been sold on April 30, 2001.
Dynea International Oy and Subsidiaries
Notes to interim consolidated condensed financial statements
3. Commitments and contingencies
3 months ended 12 months ended
March 31,2002 December 31,2001
Loans against which pledges and
mortgages have been given:
Loans from credit institutions 651.8 668.7
Chattel mortgages 58.9 58.9
Real estate mortgages 249.8 251.6
Other securities given 501.6 521.6
-------------------------------------
Collaterals total 810.2 832.0
Other securities 1.2 1.2
Leasing commitments
Portion falling due during the next
financial year 4.9 5.0
Portion for subsequent years 18.3 19.9
-------------------------------------
Total 23.3 24.9
Nominal and fair values of derivative financial instruments
-------------------------------------------------------------------------
3 months ended March 31, 2002 12 months ended December 31, 2001
-------------------------------------------------------------------------
Nominal Fair Nominal Fair
amount value amount value
-------------------------------------------------------------------------
Derivative financial instruments
Interest rate swaps and caps 187.2 (3.1) 184.6 (3.7)
Foreign exchange forward contracts 245.8 (3.1) 362.8 (1.6)
Maturity of interest rate swap contracts:
Under 1 year 147.5 (2.9) 109.2 (2.1)
2-5 years 39.7 (0.2) 75.4 (1.6)
Fair values of the interest rate swaps and foreign exchange forward contracts
are recognised in the Balance Sheet under Current Assets or Current Liabilities.
Positive and negative fair values of financial instruments are shown under
Receivables or Other Current Liabilities in accordance with IAS 39. The nominal
amounts of derivatives summarized in the above table do not represent amounts
exchanged by parties and, thus, are not a measure of Dynea International's
exposure from its use of derivatives. The nominal amounts for the forward
exchange contracts include positions, which have been effectively closed off.
Dynea International Oy and Subsidiaries
Notes to interim consolidated condensed financial statements
4. Related Party Transactions
Sales and Purchases of Goods
Dynea International sold products at market prices, to Paroc, Sydsvenska Kemi AB
and other companies, controlled by Industri Kapital, totalling
approximately(euro)2.8 million for the period from January 1, 2002 to March 31,
2002 and(euro)10.4 million during the year ended December 31, 2001. At March 31,
2002, Dynea International had receivables of (euro) 1.5 million related to these
sales.
Dynea International purchased materials and supplies, at market prices, from
Sydsvenska Kemi AB and other companies, controlled by Industri Kapital,
totalling approximately(euro)0.6 million for the period from January 1, 2002 to
March 31, 2002 and (euro) 3.9 million during the year ended December 31, 2001.
At March 31, 2002, Dynea International had payables of (euro) 0.1 million
related to these purchases.
Dynea International purchased materials and supplies, at market prices, from
associates, totalling approximately(euro)3.2 million for the period from January
1, 2002 to March 31, 2002 (euro)17.3 million during the year ended December 31,
2001.
Other Income and Expenses
A service agreement exists between Dynea International, and Dynea Oy to provide
management and support services. These management and support expense charges,
totalling amounted to(euro)1.6 million for the period from January 1, 2002 to
March 31, 2002 and to (euro) 7.1 million in 2001.
5. Subsequent event
There are no major subsequent events.