EXHIBIT 99.1
EIMO OYJ STOCK EXCHANGE RELEASE 14.11.2001 AT 8.30 a.m. 1 (8)
INTERIM REPORT JANUARY - SEPTEMBER 2001
Figures are not audited
GLOBAL SERVICE PROVIDER
- - Merger completed in August
- - Integration in full swing
- - Turnover EUR 92.0 million, growth of 28%
Performance in January-September
The Company recorded a turnover in January-September 2001 of EUR 92.0 million
(EUR 71.8 million in the corresponding period in the previous year), reflecting
growth of 28.0%. The operating profit was EUR 3.3 (10.3) million and profit
before extraordinary items was EUR 2.0 (10.3) million. The non-diluted and
diluted earnings per share were EUR 0.031 (EUR 0.16, respectively).
Despite the difficult situation in the mobile communications and other markets,
the Company's turnover reflected minor growth before adding new sales obtained
through the acquisition of Triple S. International expansion and continued sales
of profitable but lower margin bought-in components negatively affected
profitability as a percent of sales. Extraordinary expenses of EUR 1.2 million
during the period consisted mainly of costs recorded under the initial merger
agreement between Triple S and Eimo which was terminated and reinstated on
amended terms.
Eimo's income tax liability continues to be calculated on a consolidated basis,
although the basis of tax calculation has changed somewhat from that recorded
for 30 June, 2001, due to the availability of certain tax relief as a result of
Eimo's non-Finnish operations, the availability of such tax relief having now
been confirmed.
Gross investments during January to September totaled EUR 34.9 (21.8) million,
of which EUR 27.4 million represented corporate acquisitions. Of this, EUR 25.1
million was the cost of the Triple S acquisition, of which cost EUR 24.8 million
was paid through an exchange of shares. Total consolidated assets at 30
September, 2001 were EUR 161.0 (94.2) million.
The Company's financial position remained stable. The Company's equity ratio
was 48.0% at 30 September, 2001.
Eimo employed on average 1046 (736) people during January - September 2001. On
30 September, the Company had 1664 employees.
2 (8)
Developments in the Third Quarter
For financial reporting purposes, the financial results of Triple S Plastics,
Inc. and its subsidiaries have been consolidated with Eimo since 16 August, 2001
as a result of the acquisition described below. Overall, sales of EUR 43.1
million and operating profit of 5.5% in the third quarter were in line with
expectations. Sales from European and Asian operations were below target, and
their profitability was a disappointment partly due to unexpectedly high ramp-up
costs, which problems have since been overcome. In the Americas, September sales
exceeded forecast and resulted in an operating profit for the period clearly
above expectations. The quarter's cash flow after investments - excluding the
Triple S acquisition - was EUR 2.9 million.
Merger with Triple S Plastics, Inc.
Eimo's merger with and acquisition of Triple S was completed on 15 August, 2001,
at and from which time Triple S has been a 100 % owned subsidiary of Eimo.
Triple S was a U.S. public company whose U.S. headquarters were located in
Portage, Michigan. Triple S had consolidated sales of USD 155 million in its
fiscal year ended 31 March, 2001. As a result of the merger, Eimo acquired
operations in Michigan, Texas, New York and Brazil. Eimo's management believes
the integration of the Triple S operations has been going well, and medium term
prospects for the acquired operations look promising. Eimo anticipates that
many of the benefits which were originally targeted from the merger, such as
advantages in getting new business from existing and new customers, additional
margins from production of higher margin products and taking advantage of
technology transfers, will be realized. Eimo's U.S. and Brazilian operations
have obtained program commitments from several customers for a number of new
large and medium sized programs. These programs require additional capital
expenditure for production machinery including substantial amounts of automated
assembly equipment. This expenditure is estimated to rise to over EUR 10 million
during 2001-2002, and is expected to serve several at yet undefined future
programs as well. Some of the committed programs began in the third quarter of
2001, with production on others expected to ramp up at various times prior to
the end of the second quarter of 2002.
Eimo is accounting for the Triple S acquisition as a purchase in accordance with
applicable accounting rules. The total cost of the Triple S shares to Eimo was
EUR 25.1 million, while consolidated net assets of Triple S, after pre-closing
adjustments were USD 32.6 million (EUR 35.7 million) as of 16 August, 2001.
Because the value of the assets purchased exceeded the price paid (by EUR 10.6
million), the excess of the asset value has been recorded as a reserve on a
consolidated basis. Of such reserve, EUR 6.4 million has been allocated to
primarily Triple S goodwill and buildings.
3 (8)
The non-allocated portion of EUR 4.2 million has been booked as a separate item
of negative goodwill and will be accrued to earnings during the period from 16
August, 2001 to 31 March, 2002, after which period, according to management,
abnormal costs associated with Triple S operations are expected to cease.
As a result of the acquisition, the Eimo group is faced with a foreign currency
translation risk where a fall in the U.S. dollar against the euro affects
consolidated equity negatively, with no effect to the income statement. To
partially protect against this risk, Eimo plans - from time to time - to enter
into hedging arrangements, whereby an appreciation of the dollar - while
positive to Eimo's operational profitability - will add to financing costs in
the income statement.
Investments, Certifications
Apart from corporate acquisitions, most of the investments in the period covered
by this interim report were to modernize the production facility in China and to
establish painting operations in Finland. Investments in the Americas were to
implement additional decoration and finishing techniques and to increase
production capacity. The environmental system of the Company's production plant
in Helmond, the Netherlands, was certified according to ISO 14001 environmental
standards by Lloyds Register Quality Assurance. The work of obtaining
certification continues with the QS 9000 quality system. The first new
telecom/electronics customer audits for the production facilities in Shenzhen,
China have been satisfactorily completed.
Shares Outstanding and Market Prices
The daily closing price for Eimo's Series A shares on the Helsinki Stock
Exchange in the period January to September ranged between EUR 5.4 and EUR 0.88.
The closing price on 30 September 2001 was EUR 1.12.
As part of the Triple S acquisition, Eimo issued 18.1 million new Series A
shares, and in connection with the acquisition, all outstanding Series K shares
were converted into Series A shares. At 30 September, 2001, the Company had
64.5 million Series A shares and no Series K shares outstanding. At 30
September, 2001, the total number of Series A shares issuable upon the exercise
of outstanding warrants and options outstanding was slightly less than 3.5
million.
Eimo's American Depositary Shares started trading on the Nasdaq National Market
System on 16 August, 2001. Each ADS represents ten (10) Eimo Series A shares.
4 (8)
Business Prospects
The world economy remains fragile and many estimates for global sales of mobile
phones in 2001 have been downgraded to below 400 million, which implies that
several of Eimo's markets have contracted during 2001. However, supported by the
recently completed acquisition of Triple S and the fact that the Company
achieved very good sales in October, Eimo expects consolidated sales growth of
70-90% in the last quarter compared to a year ago. Quarterly operating profit is
expected to clearly exceed that of third quarter 2001.
As a result of the merger with Triple S, a larger proportion of Eimo's sales in
2001 will come from sales to customers outside the telecommunications industry
than before the merger. This reduction in concentration of sales to the
telecommunications industry in comparison to recent years is expected to remain
true through at least 2002. Eimo projects approximately 85% of its consolidated
sales in 2002 will be to telecommunications and other high tech electronics
industry (eg personal digital assistants and advanced desktop electronics),
while approximately 15% are expected to be to customers in other industries,
primarily in the automotive and pharmaceutical industries.
While no assurances can be given, Eimo continues to expect that both its pre-
acquisition operations and its operations added as a result of the acquisition
of Triple S will be profitable in 2002. Supported by growth as a result of the
acquisition of Triple S and new business expected to be obtained in 2002, Eimo
expects significant consolidated sales growth in 2002 over the prior year.
Eimo's results for 2001 will be published on 14 February 2002.
Lahti, 14 November 2001
Eimo Oyj
Board of Directors
Further information:
Heikki Marttinen, President and CEO +358-3-85050
Elmar Paananen, Vice Chairman, IR +358-500-503 865
Eimo is a leading global manufacturer of precision plastic components, whose
main customers are companies in the mobile communications industry. Eimo serves
its customers on four continents with its eleven injection molding plants and
six tool manufacturing units.
DISTRIBUTION:
HEX Helsinki Exchange
Press
5 (8)
This press release includes statements that constitute forward-looking
statements made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. This information involves risks and
uncertainties that could cause actual results to differ materially from the
forward-looking statements. For certain information regarding these risks and
uncertainties, reference is made to Eimo's Registration Statement on Form F-4
filed with the United States Securities and Exchange Commission on July 13, 2001
(copies of the prospectus from such registration statement are available from
Eimo upon written request).
APPENDIX NO. 1 TO EIMO OYJ'S STOCK EXCHANGE RELEASE 6 (8)
Consolidated profit and loss account 1-9/2001 1-9/2000 1-12/2000
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1 000 EUR 1 000 EUR Change % 1 000 EUR
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NET SALES 91 959 71 836 28.0 105 530
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Other operating income 898 216 315.7 327
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Operating costs 83 377 57 372 45.3 85 869
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Depreciation and write-downs 6 219 4 374 42.2 6 319
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OPERATING PROFIT 3 261 10 306 - 68.4 13 669
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% of net sales 3.5 14.3 - 13.0
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Financing income and expenses - 1 252 - 54 2 218.5 - 242
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PROFIT BEFORE EXTRAORDINARY ITEMS 2 009 10 252 - 80.4 13 427
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% of net sales 2.2 14.3 - 12.7
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Extraordinary items - 1 237 - 742 66.7 - 857
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PROFIT BEFORE TAXES 772 9 510 - 91.9 12 570
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% of net sales 0.8 13.2 - 11.9
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Income taxes - 509 - 2 756 - 81.5 - 3 784
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Minority interests 407 - - -7
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CONSOLIDATED PROFIT FOR THE REVIEW PERIOD 670 6 754 - 90.1 8 779
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APPENDIX NO. 2 TO EIMO OYJ'S STOCK EXCHANGE RELEASE 7 (8)
Consolidated balance sheet 30.9.2001 30.9.2000 31.12.00
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1 000 EUR 1 000 EUR Change % 1 000 EUR
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ASSETS
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NON-CURRENT ASSETS
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Intangible assets 3 028 1 268 138.8 1 323
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Tangible assets 89 110 50 788 75.5 55 388
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Investments 1 837 71 2 487.3 2 158
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CURRENT ASSETS
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Inventories 20 269 12 436 63.0 16 422
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Long-term receivables - - - -
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Deferred tax receivable 1 799 - - -
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Short-term receivables 40 350 27 461 46.9 25 109
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Cash and bank accounts 4 671 2 198 112.5 1 665
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TOTAL ASSETS 161 064 94 222 70.9 102 065
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LIABILITIES AND SHAREHOLDERS' EQUITY
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SHAREHOLDERS' EQUITY
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Share capital 16 125 11 600 39.0 11 600
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Share premium account 38 396 18 124 111.9 18 124
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Retained earnings 20 652 21 692 - 4.8 23 345
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MINORITY INTERESTS 1 285 - - 1 664
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NEGATIVE GOODWILL 3 372 - - -
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LIABILITIES
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Deferred tax liability 4 432 2 312 91.7 2 980
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Non-current liabilities
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Interest bearing liabilities 33 901 9 503 256.7 16 107
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Current liabilities
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Interest bearing liabilities 10 516 5 215 101.6 4 059
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Other non-interest bearing liabilities 25 366 20 295 25.0 20 612
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Accruals and deferred income 7 019 5 481 28.1 3 574
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 161 064 94 222 70.9 102 065
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APPENDIX NO. 3 TO EIMO OYJ'S STOCK EXCHANGE RELEASE 8 (8)
Financial ratios 30.9.2001 30.9.2000 Change % 31.12.00
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Return on equity (ROE), % 3.1 18.0 - 16.9
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Return on investment (ROI), % 4.5 22.7 - 21.0
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Equity ratio, % 48.0 56.0 - 55.0
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Net Gearing, % 52.0 24.4 - 33.8
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Current Ratio 1.52 1.36 - 1.53
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Gross investments in fixed assets, 1 000 EUR 34 926 21 789 60.3 28 785
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% of net sales 38.0 30.3 - 27.3
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Average number of personnel 1 046 736 42.1 768
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PER SHARE RATIOS
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Earnings per share (EPS), diluted, EUR 0.031 0.155 - 80.0 0.200
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Shareholders equity per share, EUR 1.165 1.108 5.2 1.144
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SECURITIES AND GUARANTEES, 1 000 EUR
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Securities for own liabilities 62 729 25 016 - 24 985
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Other own liabilities 1 616 - - -
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Nominal value of derivative contracts 7 228 2 000 - -
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Market value of derivative contracts - 265 - - -
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On behalf of outsiders - - - -
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