Lemminkäinen's Interim Report, 1 January - 31 March 2012

LEMMINKÄINEN CORPORATION            INTERIM REPORT    3 MAY 2012 AT 8:00 A.M.
 

LEMMINKÄINEN'S INTERIM REPORT, 1 JANUARY - 31 MARCH 2012:
Improved profitability and a stronger order book.


January-March 2012 compared to the corresponding period of 2011: 

-
Net sales in January-March amounted to EUR 328.0 million (316.3).
-
The order book stood at EUR 1,625.4 million (1,471.7) at the end of review period.
-
The operating profit was EUR -21.6 million (-28.0). The operating margin was -6.6% (-8.9).
-
The pre-tax profit amounted to EUR -24.2 million (-30.0).
-
Earnings per share were EUR -1.02 (-0.59).
-
Cash flow from operations totalled EUR 35.7 million (-38.3).
-
The balance sheet total was EUR 1,293.5 million (1,098.5), and the interest-bearing net debt EUR 305.8 million (369.9).

Key figures, IFRS, EUR million 1-3/2012 1-3/2011 Change 1-12/2011
Net sales 328.0 316.3 4% 2,274.1
- of which operations outside Finland 103.4 71.9 44% 780.3
Operating profit -21.6 -28.0 23% 53.5
Operating margin, % -6.6 -8.9   2.4
Pre-tax profit -24.2 -30.0 19% 34.6
Earnings from discontinued operations1)  
11.3
 
11.3
Result for the period -20.0 -11.7 -71% 35.6
Earnings per share, EUR -1.02 -0.59 -73% 1.77
Cash flow from operations 35.7 -38.3   -7.1

1) Lemminkäinen divested its roofing business on 31 Jan 2011, from which it entered EUR 15.3 million in capital gain. The capital gain impacts both the Group's result and Earnings per share for 1-3/2012 and 1-12/2011.

 

Key figures, EUR million 31.3.2012 31.3.2011 Change 31.12.2011
Order book 1,625.4 1,471.7 10% 1,400.4
-         of which unsold 203.8 192.7 6% 206.3
-         of which operations outside Finland
613.9

445.7

38%

482.5
Balance sheet total 1,293.5 1,098.5 18% 1,242.8
Interest-bearing net debt 305.8 369.9 -17% 401.2
Equity ratio, % 34.2 32.6   30.8
Gearing, % 76.1 117.2   114.5
Return on investment
(rolling 12 months), %

9.5

8.6
 
10.8

 
President & CEO Timo Kohtamäki:

"Lemminkäinen's operating profit and pre-tax profit improved on the first quarter of 2011. This is a good achievement for the traditionally weak first quarter -considering that last year our paving operations in Norway grew, which, in turn, increased the seasonal loss. On the other hand, the volume of special contracting in infrastructure construction - which is not affected by seasonal fluctuations - is clearly growing in our business portfolio," says Lemminkäinen's President & CEO Timo Kohtamäki.

"Our order book continued to grow robustly in the other Nordic countries and Russia, which are our strategic growth areas.  In Finland, our order book remained at the same level as in 2011. Our residential unit sales were brisk, and we signed notable, long-term agreements for the maintenance and upkeep of technical building systems. Although the volume of competitive contracting was lower than last year in all business sectors, their profitability improved."

Kohtamäki says that the EUR 50 million efficiency programme launched in October 2011 is progressing well. "We estimate that we'll achieve about EUR 20 million in cost savings this year. Another of our key development programmes - working capital optimization - is also progressing to plan."

At the end of the review period, Lemminkäinen issued a EUR 70 million domestic hybrid bond. "It will strengthen our capital structure and financial position, giving us more latitude to implement our strategy," says Kohtamäki.

Profit guidance for 2012

Lemminkäinen's guidance remains unchanged. The company estimates that its 2012 net sales will remain at the same level as in 2011, and that its pre-tax profit will improve on 2011. Lemminkäinen's estimate is based on good performance during the first quarter, as well as a larger order book and order book margin than in 2011. The company estimates that the construction market will remain stable.  

Market outlook

General economic uncertainty has not weakened demand for construction to the same extent as was feared at the turn of the year. The total volume of construction in Finland is expected to fall slightly in 2012 with growth resuming in 2013.  Construction is increasingly centred on growth centres. The market situation for infrastructure construction in Sweden, Norway and Denmark is expected to remain good. Demand for residential construction in Russia will remain high. 

Briefing 

A Finnish-language briefing for analysts and the media will be held at 2.00 p.m. on Thursday, 3 May at Lemminkäinen's head office. The street address is Salmisaarenaukio 2, Helsinki, Finland. The interim report will be presented by President & CEO Timo Kohtamäki. Presentation material is available in Finnish and English on the company's website, www.lemminkainen.com.

2012 financial releases

2 August 2012 - Interim report, January-June 2012
1 November 2012 - Interim report, January-September 2012

LEMMINKÄINEN CORPORATION
Corporate Communications

ADDITIONAL INFORMATION:

Timo Kohtamäki, President & CEO, tel. +358 (0)2071 53263

Robert Öhman, CFO, tel. +358 (0)2071 53515

Katri Sundström, Vice President, Investor Relations, tel. +358 (0)2071 54813

APPENDICES:
Interim Report, 1 Jan-31 Mar 2012
Interim Report, tabulated section

DISTRIBUTION:
NASDAQ OMX Helsinki
key media
www.lemminkainen.com


Lemminkäinen Group operates in all areas of the construction sector. The Group's business sectors are building construction, infrastructure construction, technical building services and international operations. Net sales in 2011 were about EUR 2.3 billion, of which international operations accounted for roughly one third. The Group employs an average of 8,400 people. Lemminkäinen Corporation's share is quoted on NASDAQ OMX Nordic Exchange Helsinki. www.lemminkainen.com