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Thursday 23 October, 2014

Okmetic Oyj

OKMETIC'S INTERIM REPORT 1 JANUARY - 30 SEPTEMB...

OKMETIC'S INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2014: STRONG THIRD QUARTER DUE TO SOLID DEMAND FOR SENSOR WAFERS

OKMETIC OYJ STOCK EXCHANGE RELEASE 23 OCTOBER 2014 AT 8.00 A.M.

INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2014: STRONG THIRD QUARTER DUE TO SOLID DEMAND FOR SENSOR WAFERS

Unless otherwise stated, figures in parenthesis refer to the corresponding period in the previous year.

JULY-SEPTEMBER IN BRIEF:

 - Net sales amounted to 19.3 (18.2) million euro, up 5.9%.
 - Silicon wafer shipments amounted to 17.5 (17.8) million euro, down 1.3%.
 - Operating profit was 2.8 (1.4) million euro, corresponding to 14.3% (7.8%) of net sales.
 - Profit for the period was 2.2 (0.8) million euro.
 - Basic earnings per share was 0.13 (0.05) euro.
 - Net cash flow from operations amounted to 3.6 (3.5) million euro.

JANUARY-SEPTEMBER IN BRIEF:

 - Net sales amounted to 55.4 (51.7) million euro, up 7.2%.
 - Silicon wafer shipments amounted to 52.9 (50.2) million euro, up 5.4%.
 - Operating profit was 4.8 (4.8) million euro, corresponding to 8.7% (9.2%) of net sales.
 - Profit for the period was 3.7 (3.4) million euro.
 - Basic earnings per share was 0.22 (0.20) euro.
 - Net cash flow from operations amounted to 6.2 (4.8) million euro.

SHORT-TERM OUTLOOK

The demand for semiconductors is expected to grow in 2014. Also for the silicon wafer market, growth is expected in 2014. Following the growth in shipment volumes, the long decline in the value of the silicon wafer market is anticipated to end this year.

The demand for Okmetic's demanding sensor wafers is estimated to grow year-on-year in 2014, and the price level is expected to remain fairly stable.

Prices of semiconductor wafers are being hit by the weakened Japanese yen, as the Japanese manufacturers hold a significant stake of the silicon wafer market. However, the demand is expected to pick up somewhat in 2014 compared to 2013.

Other business sales are not expected to materially differ from the low level of year 2013.

In the fourth quarter, the demand for silicon wafers is expected to be lower than in the second and third quarters of the year, in accordance with normal seasonal fluctuation.

The company retains its existing guidance, according to which net sales and operating profit in 2014 are estimated to exceed the level of year 2013.

PRESIDENT KAI SEIKKU:

"The strong sales trend of strategically important sensor wafers continued in January-September, as the shipments grew by 12.3 percent from the comparison period. The demand for sensor wafers was particularly strong in Europe. Sales grew in all of the company's main market areas excluding Japan. Sensor wafer development has been in line with the long-term growth target as redefined in the Capital Markets Day at the end of September. In contrast, the demand for semiconductor wafers has clearly been weaker in 2014 in relation to the corresponding period last year.

The third quarter is traditionally the peak demand season for Okmetic's products. Operating profit, 2.8 million euro, strengthened notably in July-September both quarter-on-quarter (1.1 million euro in Q2 2014) and year-on-year (1.4 million euro in Q3 2013). The increase in profitability was driven by the sales of high value added products that is growing in line with Okmetic's strategy. In the third quarter, also the strengthening of the US dollar as well as non-operational income in the United States (0.3 million euro) improved operating profit. Operating profit in the third quarter of last year was burdened by non-operational items (0.6 million euro).

When assessing profitability of the business it is worth noticing that depreciation grew by 0.7 million euro in January-September. Operating profit before depreciation was 9.7 (9.0) million euro in January-September. Net cash flow from operating activities, 6.2 million euro, was at a good level in January-September considering the extra polysilicon inventory tied up in working capital. The company's working capital is up as a result of a higher raw material inventory, which has grown due to the polysilicon purchasing contracts. With the growing of solar crystals based on own raw material now ended, this inventory is being released. A reduction in working capital is not expected until the expiration of the long-term contracts at the end of 2015.

The ongoing annual contract negotiations as well as new customerships and customer qualifications indicate a continuing positive trend in sensor wafers for next year. Meanwhile, in semiconductor wafers, prices will remain under pressure."

KEY FIGURES

1,000 euro 1 Jul-
30 Sep,
2014
1 Jul-
30 Sep,
2013
1 Jan-
30 Sep,
2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec
2013
           
Net sales 19,320 18,242 55,425 51,680 68,516
Operating profit
before
depreciation
(EBITDA)



4,420



2,921



9,745



9,024



10,905
Operating profit 2,757 1,423 4,822 4,768 5,031
 % of net sales 14.3 7.8 8.7 9.2 7.3
Profit for
the period

2,219

816

3,749

3,395

3,842
Basic earnings
per share,
euro


0.13


0.05


0.22


0.20


0.23
Net cash flow
from operating
activities


3,644


3,481


6,209


4,811


9,726
Net interest-
bearing
liabilities


4,174


6,196


4,174


6,196


6,530
Equity ratio, % 70.6 70.5 70.6 70.5 68.2
Average number
of personnel
during the period


379


369


371


366


363

MARKETS

Customer industries sensor and semiconductor industry

Sensor industry

The increasing use of micro sensors in many consumer electronics and automotive industry products has accelerated sensor sales growth. In 2014, the sale value of sensor industry is estimated to grow by 6-11 percent. In terms of volume, sensor shipments are likely to clearly reach a new record in 2014, too. (IHS, Yole)

Semiconductor industry

In the third quarter of 2014, the sales of the global semiconductor industry in US dollars continued to grow. In January to August, the sales grew by 10 percent from the corresponding period last year (SIA). For the whole year 2014, the growth estimates have settled between 6.5 and 9.8 percent (WSTS, Gartner, Cowan). Almost all product areas contributed to continued semiconductor sales growth, especially tablet computers (SIA, Gartner).

Silicon wafer market

According to the report of SMG, the group of silicon wafer suppliers in SEMI (a global umbrella organisation for semiconductor materials and equipment industry), the surface area of silicon wafer shipments calculated in square inches grew by 10 percent year-on-year in the first half of 2014. For the whole year 2014, SEMI forecasts 7 percent growth, which would break the record in the yearly volume of silicon wafer shipments. Following the growth in shipment volumes, the long decline in the value of the silicon wafer market in US dollars is expected to end this year.

The key customer areas for Okmetic in the silicon wafer market

In line with its strategy, Okmetic seeks niches in the silicon wafer market, where growth exceeds market average and in which the company has special expertise. Okmetic supplies primarily 150mm and 200mm wafers. The sensor/MEMS industry is a key growth area for Okmetic. MEMS market grows as portable consumer products, automotive electronics, and industrial process control increase.

In the semiconductor market, Okmetic's growth areas include discrete and power semiconductors. In these wafer markets, areas for growth include, among others, components used in the production of renewable energy, increasing automotive electronics, portable consumer products, as well as different solutions related to power supply and efficiency improvement.

SALES

In the third quarter, net sales grew by 5.9 percent year-on-year and amounted to 19.3 (18.2) million euro. In January-September, net sales grew by 7.2 percent from the comparison period and amounted to 55.4 (51.7) million euro. Sensor wafer shipments increased whereas semiconductor wafer shipments diminished from last year in both periods. There have been no significant changes in the market positions of Okmetic in the product groups important to the company.

Sales per customer area

  1 Jul-
30 Sep,
 2014
1 Jul-
30 Sep,
 2013
1 Jan-
30 Sep,
 2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec,
 2013
           
Sensor wafers 61% 59% 63% 59% 59%
Semiconductor
wafers

34%

38%

34%

38%

37%
Other business 5% 3% 3% 3% 4%

The value of sensor wafer shipments grew by 12.3 percent year-on-year in January-September. In the same period, the value of semiconductor wafer shipments declined by 5.3 percent. In the third quarter, semiconductor wafer shipments were, however, bigger than in the first and second quarters.
The value of Other business shipments amounted to 1.9 (1.7) million euro in January-September.

Sales per market area

  1 Jul-
30 Sep,
 2014
1 Jul-
30 Sep,
 2013
1 Jan-
30 Sep,
 2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec,
 2013
           
North America 37% 43% 38% 41% 42%
Europe 42% 41% 41% 40% 40%
Asia 21% 16% 21% 19% 18%

Regionally, most sales originated in Europe and North America.

PROFITABILITY

July-September

Okmetic's operating profit amounted to 2.8 (1.4) million euro, i.e. 14.3 (7.8) percent of net sales in July-September.

The operating profit was favourably impacted by the strengthening of the US dollar, the sale of a redundant lot at the Allen production site, 0.2 million euro, as well as insurance claims paid out to the Allen plant, 0.1 million euro. In the comparison period, operating profit was reduced by non-operational items (0.6 million euro).

Profit for the period amounted to 2.2 (0.8) million euro. Basic earnings per share was 0.13 (0.05) euro. Diluted earnings per share was 0.13 (0.05) euro.

January-September

In January-September, Okmetic's operating profit amounted to 4.8 (4.8) million euro, i.e. 8.7 (9.2) percent of net sales. Profit for the period amounted to 3.7 (3.4) million euro. Basic earnings per share was 0.22 (0.20) euro. Diluted earnings per share was 0.22 (0.20) euro.

FINANCING

The company's financial position is solid. In January-September, net cash flow from operations amounted to 6.2 (4.8) million euro. The changes in working capital tied up in operations weakened cash flow from operations by 2.7 (5.0) million euro.

On 30 September 2014, the company's interest-bearing liabilities amounted to 14.5 (11.8) million euro. Okmetic issued a multi-issuer bond in June, due to which interest-bearing liabilities increased by five million euro. The maturity of the multi-issuer bond is five years. The financing is used for investments and general corporate purposes.

At the end of the reporting period, cash and cash equivalents amounted to 10.3 (5.6) million euro. On 30 September 2014, the company's net debt was 4.2 million euro (on 30 September 2013, net debt amounted to 6.2 million euro).

The group has ensured liquidity with committed credit facilities of 6.0 million euro. On 30 September 2014, the committed credit facilities were fully unused (as well as on 30 September 2013).

Return on equity amounted to 8.4 (7.4) percent. The company's equity ratio was 70.6 (70.5) percent. Equity per share was 3.69 (3.67) euro.

INVESTMENTS

In January-September, Okmetic's capital expenditure amounted to 2.5 (5.8) million euro. The investments were mainly for increasing capacity of 200mm wafers at the Vantaa plant.

PRODUCT DEVELOPMENT

The company expensed 1.8 (1.9) million euro in product development projects in January-September, corresponding to 3.2 (3.6) percent of net sales. Product development costs have not been capitalised. Emphasis in product development was on engineered products. Focus areas include broadening the SOI product family, improving capability in 200mm wafers as well as developing crystal growing to enhance capability in high and low resistivity products.

PERSONNEL

On average, Okmetic employed 371 (366) people in January-September. At the end of the period, Okmetic had 363 (356) employees, of which 318 worked in Finland, 39 in the US, five in Japan, and one in Hong Kong.

BUSINESS RISKS

There have been no significant changes in the company's near future business risks and uncertainties.

Okmetic's business is confronted by risks, which may arise from the company's operations or changes in its operating environment. Risks that, if materialized, can have an adverse effect on the company's operations and valuation are described below.

Okmetic's silicon wafer sales are targeted at the sensor and semiconductor producers in the electronics industry. The demand for semiconductor wafers is sensitive to economic fluctuations, and changes in the market situation can be sudden and dramatic. The demand for sensor wafers is more stable. The proliferation of sensors in consumer electronics applications may, however, increase the susceptibility of this market too to economic fluctuations.

Okmetic has existing polysilicon purchasing obligations partly until the end of 2015. Since the price level of the solar cell market has dropped, the validity of long-term polysilicon purchase contracts typical of the industry may cause a price risk.

Okmetic's share of the global silicon wafer market is around one percent, and the market prices have a notable effect on the price development of Okmetic's products. The company has considerable pricing power only in its own special products. The pricing of other wafers is largely based on global market price.

Okmetic operates globally, and therefore the company's business is affected by risks due to exchange rate fluctuations, consisting of cash flows from purchases and sales. A significant part of sales is conducted in US dollars. Despite hedging, the company remains exposed to exchange rate fluctuations.

Substantial amounts of electricity are used in Okmetic's production. Despite hedging, the company is exposed to fluctuations in the price of electricity.

SHARES AND SHAREHOLDERS

On 30 September 2014, Okmetic Oyj's paid-up share capital, as entered in the Finnish Trade Register, was 11,821,250 euro. The number of shares was 17,287,500. The shares have no nominal value attached. Each share entitles to one vote at general meetings. The company has one class of shares. The company's shares are included in the Finnish book-entry system.

Major shareholders on
30 September 2014

  Shares,
pcs
Share,
%
Ilmarinen Mutual Pension
Insurance Company


1,004,985


5.8
Oy Ingman Finance Ab 870,000 5.0
Mandatum Life Insurance
Company Limited

800,000

4.6
The State Pension Fund 600,000 3.5
Nordea Nordic Small
Cap Fund

528,810

3.1
Varma Mutual Pension
Insurance Company

477,175

2.8
Okmetic Oyj *) 416,763 2.4
Etra-Invest Oy Ab  400,000 2.3
Investment Fund
Taaleritehdas Arvo
Markka Osake


300,100


1.7
Nordea Finland Small Cap
Fund

250,095

1.5
Foreign investors and
nominee accounts held by
custodian banks


2,876,684


16.6
Other 8,762,888 50.7
Total 17,287,500 100.0

*)Of Okmetic Oyj's shares, 400,000 pcs are owned through Okmetic Management Oy.

SHARE PRICE PERFORMANCE AND TRADING

A total of 2.8 (2.2) million shares were traded between 1 January and 30 September 2014, representing 16.1 (12.9) percent of the weighted average of share total of 17.3 (17.3) million during the period. The lowest quotation during the period was 4.38 (4.25) euro, and the highest 5.25 (5.55) euro, with the average trading price being 4.67 (4.78) euro. The closing quotation for the period was 4.95 (5.31) euro. At the end of the period, the market capitalisation amounted to 85.6 (91.8) million euro.

OWN SHARES AND DIRECTED SHARE ISSUES

In a directed share issue on 16 January 2014, Okmetic Oyj transferred a total of 150,000 own shares held by the company to President Kai Seikku (140,000 shares) and Deputy to the President of that time, Mikko Montonen (10,000 shares). Subscription price per share was determined using the average trading price of the company's share weighted by trading volume in NASDAQ OMX Helsinki Oy on 16 January 2014, and was 4.9969 euro.

On 13 February 2014, Okmetic Oyj's board of directors announced of its decision to transfer a total of 11,919 own shares held by the company as a part of the company's share-based incentive scheme for the executive management group, of which the company gave a stock exchange release on 12 February 2013.

According to the decision of the annual general meeting, Okmetic Oyj transferred a total of 15,441 shares to the board members as payment of the annual remuneration on 9 May 2014.

At the end of the reporting period Okmetic held 416 763 (194 123) own shares, of which 400 000 shares through Okmetic Management Oy. The number of own shares corresponds to approximately 2.4 (1.1) percent of all Okmetic shares and votes.

OTHER EVENTS IN THE INTERIM PERIOD

On 15 January 2014, the board of directors decided to dissolve the ownership arrangement of Okmetic Management Oy, owned by President Kai Seikku and Deputy to the President of that time, Mikko Montonen, with an arrangement in which Okmetic Oyj acquired the entire share capital of Okmetic Management Oy. Also 400,000 shares of Okmetic Oyj were transferred to the group via Okmetic Management Oy, as well as a loan receivable of Okmetic Oyj from Okmetic Management Oy. The value of the arrangement for the part of shares owned by Okmetic Management Oy was determined using the average trading price weighted by trading volume of the company's share in NASDAQ OMX Helsinki Oy on 16 January 2014, 4.9969 euro. There were no shareholders of Okmetic Management Oy in the board of directors of Okmetic Oyj.

Mikko Montonen, Executive Vice President, Customers and Markets, Deputy to the President, resigned from Okmetic on 26 February 2014 to assume a new position with another company. Mr. Montonen's management responsibilities at Okmetic ended on 6 April 2014.

Anna-Riikka Vuorikari-Antikainen, then Senior Vice President, Products, was appointed Senior Vice President, Customers and Markets from 7 April 2014. Ms. Vuorikari-Antikainen is also responsible for customer support.
Atte Haapalinna, then Senior Vice President, Customer Support, was appointed Senior Vice President, Products from 7 April 2014.

In connection with Okmetic's Capital Markets Day on 26 September 2014, the company modified its long-term targets slightly as:
- Organic growth of sensor wafer business at 10 percent per annum or more
- Operating profit to account for 10 percent of net sales or more

This implies no explicit growth target for sales of other type of wafers, or Other business.

CONDENSED FINANCIAL STATEMENTS AND TABLES 1 JANUARY - 30 SEPTEMBER 2014 (unaudited)

ACCOUNTING POLICIES

These interim financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting.

In preparing these interim financial statements, Okmetic has followed the same accounting policies as in the financial statements for 2013 except for the effect of changes required by the adoption of certain new or revised standards and interpretations as of 1 January 2014, which have been described in financial statements 2013. The adoption of the new and revised standards and interpretations has not had an effect on the figures presented from the reporting period.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

1,000 euro 1 Jul-
30 Sep,
2014
1 Jul-
30 Sep,
2013
1 Jan-
30 Sep,
2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec,
2013
           
Net sales 19,320 18,242 55,425 51,680 68,516
Cost of sales -14,942 -14,594 -44,098 -40,536 -54,918
Gross profit 4,378 3,648 11,327 11,144 13,598
Other income
and expenses

-1,621

-2,225

-6,505

-6,376

-8,567
Operating
profit

2,757

1,423

4,822

4,768

5,031
Financial
income and
expenses


49


-143


-28


-399


-630
Profit before
tax

2,806

1,280

4,794

4,369

4,401
Income tax -587 -464 -1,045 -974 -559
Profit for
the period

2,219

816

3,749

3,395

3,842
           
Other
comprehensive
income:
         
Items that may
be
reclassified
to profit or
loss in
subsequent
periods
         
Cash flow
hedges

16

100

17

-17

-58
Translation
differences

557

-323

566

-27

-60
Other
comprehensive
income for the
period, net of
tax




573




-224




584




-44




-118
           
Total
comprehensive
income for the
period



2,792



591



4,333



3,351



3,724
           
Profit for the
period
attributable
to:
         
Equity holders
of the parent
company


2,219


816


3,749


3,395


3,842
           
Total
comprehensive
income
attributable
to:
         
Equity holders
of the parent
company


2,792


591


4,333


3,351


3,724
           
Basic earnings
per share,
euro


0.13


0.05


0.22


0.20


0.23
Diluted
earnings per
share, euro


0.13


0.05


0.22


0.20


0.22
           

CONDENSED CONSOLIDATED BALANCE SHEET

1,000 euro 30 Sep,
2014
30 Sep,
2013
31 Dec,
2013
       
Assets      
Non-current assets      
Property, plant and
equipment

42,864

45,038

45,295
Intangible assets 740 888 897
Other receivables 732 2,020 1,419
Total non-current
assets

44,335

47,945

47,611
       
Current assets      
Inventories 17,748 17,893 16,634
Receivables 16,440 15,432 14,572
Cash and cash
equivalents

10,279

5,617

5,214
Total current
assets

44,467

38,941

36,420
       
Total assets 88,802 86,886 84,031
       
Equity and liabilities      
Equity      
Equity attributable
to equity holders of
the parent company
     
Share capital 11,821 11,821 11,821
Other equity 50,398 49,398 45,451
Total equity 62,219 61,219 57,273
       
Liabilities      
Non-current
liabilities

13,407

12,804

10,533
Current liabilities 13,175 12,863 16,226
Total liabilities 26,583 25,667 26,759
       
Total equity and
liabilities

88,802

86,886

84,031

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

1,000 euro 1 Jan-
30 Sep,
2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec,
2013
       
Cash flows from operating
activities:
     
Profit before tax 4,794 4,369 4,401
Adjustments 4,399 4,591 6,566
Change in working capital -2,697 -5,000 -2,091
Financial items -357 -121 -126
Tax paid 70 972 976
Net cash from
operating activities

6,209

4,811

9,726
       
Cash flows from investing
activities:
     
Purchases of property,
plant and equipment

-3,335

-7,784

-9,089
Proceeds from sale of
property, plant and
equipment


696


-


-
Net cash used in
investing activities

-2,639

-7,784

-9,089
       
Cash flows from financing
activities:
     
Proceeds from long-
term borrowings

5,000

10,000

10,000
Proceeds of short-term borrowings
4,000

24

1,024
Payments of long-term
borrowings

-2,000

-1,000

-1,000
Payments of short-term
borrowings

-4,024

-3,043

-4,043
Payments of finance
lease liabilities
 

-437
 

-349

-478
Other items 36 10 10
Dividends paid -578 -4,170 -6,763
Capital repayment - - -1,169
Share issue 750 - -
Acquisition of Okmetic
Management Oy's share
capital


-1,516


-


-
Net cash used in
financing activities

1,230

1,473

-2,419
       
Increase (+) /
decrease (-) in cash
and cash equivalents


4,799


-1,500


-1,782
Exchange rate changes 266 -171 -292
Cash and cash
equivalents at
the beginning
of the period



5,214



7,288



7,288
Cash and cash
equivalents at
the end of the
period



10,279



5,617



5,214
       

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

  Equity attributable to equity holders of parent company
 

 

 

1,000 euro
Share
capital
Share
pre-mium
Reserve
for invested
un-restricted
equity
Other
reserves
 1)
Retained
earnings
Total
Balance at
31 Dec,
2013


11,821


20,045


3


1,756


23,647


57,273
Profit for
the period
       
3,749

3,749
Other com-
prehensive
income,
net of
tax:
           
Cash flow
hedges
     
17
 
17
Trans-
lation
differ-
ences
     


566
 


566
Total com-
prehensive
income for
the period
     


584



3,749



4,333
             
Share
issue
   
750
   
750
Share-
based
payments
       

221


221
Acquisi-
tion of
non-
control-
ling
interest
       




-357





-357
Balance at
30 Sep,
2014


11,821


20,045


753


2,339


27,260


62,219
             
Balance at
31 Dec,
2012


11,821


20,045


1,200


1,874


26,919


61,860
Profit for
the period
       
3,395

3,395
Other com-
prehensive
income,
net
of tax:
           
Cash flow
hedges
     
-17
 
-17
Trans-
lation
differ-
ences
     


-27
 


-27
Total com-
prehensive
income for
the period
     


-44



3,395



3,351
             
Share-
based
payments
       

178


178
Dividends
distribut-
ed
       

-4,170


-4,170
Balance at
30 Sep,
2013


11,821


20,045


1,200


1,830


26,323


61,219

1)"Other reserves" contains hedge reserve and translation differences.

Acquisition of shares of Okmetic Management Oy is treated as acquisition of non-controlling interest.

CHANGES IN PROPERTY, PLANT AND EQUIPMENT

1,000 euro 1 Jan-
30 Sep,
2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec,
2013
       
Carrying amount
at the beginning
of the period


45,295


43,433


43,433
Additions 2,465 5,777 7,648
Disposals -501 -9 -9
Depreciation -4,678 -4,080 -5,623
Exchange differences 283 -83 -154
Carrying amount
at the end of
the period


42,864


45,038


45,295

COMMITMENTS AND CONTINGENCIES

1,000 euro 30 Sep,
2014
30 Sep,
2013
31 Dec,
2013
       
Loans secured with
collaterals

8,000

10,000

10,000
Collaterals 17,128 17,128 17,128
Off-balance sheet
lease commitments

308

380

395
       
Capital commitments 1,902 2,112 1,910
       
Nominal values of
derivative contracts
     
Currency options, call 226 - 948
Currency options, put - - 182
Currency forward
agreements

1,631

903

1,144
Electricity derivatives 1,270 2,117 1,847
       
Fair values of
derivative contracts
     
Currency options, call 0 - 12
Currency options, put - - -1
Currency forward
agreements

-77

15

20
Electricity derivatives -205 -173 -350

The contract price of the derivatives has been used as the nominal value of the underlying asset.

HIERARCHY LEVELS OF DERIVATIVE CONTRACTS MEASURED AT FAIR VALUE

1,000 euro 30 Sep, 2014   30 Sep, 2013
  Level 1 Level 2 Level 3   Level 1 Level 2 Level 3
Financial
assets
         
Derivative
financial
instruments

-

13

-
 
-

38

-
          
Financial
liabilities
         
Derivative
financial
instruments

-

296

-
 
-

196

-

Fair value estimation

The group's financial instruments that are measured at fair value comprise derivatives used for hedging and held for trading, and they are classified on hierarchy level 2.

Fair values of level 2 instruments are based on other data than quoted prices in active markets, but on data from which the asset is observable, either directly (i.e. price) or indirectly (i.e. derived from the prices).

Fair value determination

The fair values of currency derivatives are determined by using mark-to-market method at the reporting date.

The fair values of electricity derivatives are determined on the basis of market quotations and contract prices of the instruments at the reporting date.

KEY FIGURES SHOWING FINANCIAL PERFORMANCE

1,000 euro 1 Jan-
30 Sep,
2014
1 Jan-
30 Sep,
2013
1 Jan-
31 Dec,
2013
       
Net sales 55,425 51,680 68,516
Change in net sales
compared to the previous
year's period, %


7.2


-17.2


-17.5
Export and foreign
operations share
of net sales, %


91.2


91.2


91.8
Operating profit before
depreciation (EBITDA)

9,745

9,024

10,905
  % of net sales 17.6 17.5 15.9
Operating profit 4,822 4,768 5,031
  % of net sales 8.7 9.2 7.3
Profit before tax 4,794 4,369 4,401
  % of net sales 8.6 8.5 6.4
Return on equity, % 8.4 7.4 6.4
Return on investment, % 9.1 8.6 6.7
Non-interest-bearing
liabilities

12,129

13,855

15,014
Net interest-bearing
liabilities

4,174

6,196

6,530
Net gearing ratio, % 6.7 10.1 11.4
Equity ratio, % 70.6 70.5 68.2
Capital expenditure 2,465 5,777 7,648
  % of net sales 4.4 11.2 11.2
Depreciation 4,923 4,256 5,874
Research and development
expenditure

1,801

1,876

2,779
  % of net sales 3.2 3.6 4.1
       
Average number of
personnel during
the period


371


366


363
Personnel at the
end of the period

363

356

355
       

KEY FIGURES PER SHARE

When calculating equity per share, Okmetic's own shares and Okmetic shares owned by Okmetic Management Oy are deducted from the total number of shares.

Euro 30 Sep,
2014
30 Sep,
2013
31 Dec,
2013
Basic earnings
per share

0.22

0.20

0.23
Diluted earnings
per share

0.22

0.20

0.22
Equity per share 3.69 3.67 3.43
Capital repayment per
share

-

-

0.07
Dividend per share - - -
Dividends/earnings, % - - -
Effective dividend
yield, %

-

-

-
Price/earnings(P/E) - - 20.9
       
Share performance
(1.1.-)
     
Average trading price 4.67 4.78 4.92
Lowest trading price 4.38 4.25 4.25
Highest trading price 5.25 5.55 5.66
Trading price at the
end of the period

4.95

5.31

4.82
Market capitalisation
at the end of the
period, 1,000 euro


85,573


91,797


83,326
       
Trading volume,
transactions, 1,000 pcs

2,784

2,223

3,382
In relation to weighted
average number of
shares, %


16.1


12.9


19.6
Trading volume,
1,000 euro

13,048

10,620

16,647
The weighted average
number of shares during
the period under review
adjusted by the share
issue, 1,000 pcs




17,288




17,288




17,288
The number of shares at
the end of the period
adjusted by the share
issue, 1,000 pcs



17,288



17,288



17,288

QUARTERLY KEY FIGURES

1,000 euro 10-12/
2014
7-9/
2014
4-6/
2014
1-3/
2014
         
Net sales   19,320 18,700 17,405
  Compared to previous
  quarter, %



3.3

7.4

3.4
  Compared to corresponding
  period last year, %
 
5.9

9.8

6.1
Operating profit   2,757 1,137 928
  % of net sales   14.3 6.1 5.3
Profit before tax   2,806 1,096 892
  % of net sales   14.5 5.9 5.1
         
Net cash flow generated
from:
Operating activities





3,644


1,932


632
Investing activities   261 -1,263 -1,637
Financing activities   -3,157 4,859 -472
Increase/decrease in cash
and cash equivalents
 
748

5,528

-1,477
         
Personnel at the end
of the period
 
363

393

354

1,000 euro 10-12/
2013
7-9/
2013
4-6/
2013
1-3/
2013
         
Net sales 16,837 18,242 17,035 16,403
  Compared to previous
  quarter, %

-7.7

7.1

3.9

-20.7
  Compared to corresponding
  period last year, %

-18.6

-13.2

-24.2

-13.2
Operating profit 263 1,423 1,971 1,373
  % of net sales 1.6 7.8 11.6 8.4
Profit before tax 32 1,280 1,812 1,277
  % of net sales 0.2 7.0 10.6 7.8
         
Net cash flow generated
from:
Operating activities


4,915


3,481


519


811
Investing activities -1,304 -1,687 -1,966 -4,131
Financing activities -3,892 -1,155 -7,276 9,904
Increase/decrease in cash
and cash equivalents

-281

639

-8,724

6,585
         
Personnel at the end
of the period

355

356

379

354

DEFINITIONS OF KEY FINANCIAL FIGURES

     
Operating profit before depreciation (EBITDA) = Operating profit + depreciation
     
Return on equity (ROE), % = Profit/loss for the period x 100/
    Equity(Average for the period)
     
Return on investment (ROI), % = (Profit/loss before tax + interest and other financial expenses) x 100/
    Balance sheet total - non-interest bearing liabilities(average for the period)
     
Equity ratio, % = Equity x 100/
    Balance sheet total - advances received
     
Net interest-bearing liabilities = Interest-bearing liabilities - cash and cash equivalents
     
Net gearing ratio, % = (Interest-bearing liabilities - cash and cash equivalents) x 100/
    Equity
     
Earnings per share = Profit/loss for the period attributable to  equity holders of the parent company/
    Adjusted weighted average number of shares in issue during the period
     
Equity per share = Equity attributable to equity holders of the parent company/
    Adjusted number of shares at the end of the period
     
Dividend per share = Dividend for the period/
    Adjusted number of shares at the end of the period
     
Effective dividend yield, % = Dividend per share x 100/
    Trading price at the end of the period
     
Price/earnings ratio (P/E) = Last adjusted trading price at the end of the period/
    Earnings per share
     
Average trading price = Total traded amount in euro/
    Adjusted number of shares traded during the period
     
Market capitalisation at the end of the period = Number of shares at the end of the period x trading price at the end of the period
     
Trading volume = Number of shares traded during the period/
    Weighted average number of shares during the period

All figures of the financial tables are rounded, and consequently the sum of individual figures can deviate from the presented sum figure.

The future estimates and forecasts in this interim report are based on the company management's current knowledge. Actual events and results may differ from the estimates presented here.

INTERIM REPORT BRIEFING

A briefing for investors, analysts and media will take place at Bank Meeting Point, Unioninkatu 20, Helsinki (2nd floor) today Thursday, 23 October 2014 at 8.30 a.m. The result will be presented by President Kai Seikku. Welcome!

OKMETIC OYJ

Board of directors

For further information, please contact:

President Kai Seikku, Okmetic Oyj,
tel. +358 5028 0232, email: [email protected]

Senior Vice President, Finance, IT and Communications
Juha Jaatinen, Okmetic Oyj, tel. +358 9 5028 0286,
email: [email protected]

Distribution:
Nasdaq Helsinki
Principal media
www.okmetic.com

OKMETIC IN BRIEF

Okmetic is a technology company which supplies tailor-made silicon wafers for sensor and semiconductor industries and sells its technological expertise. Okmetic provides its customers with solutions that boost their competitiveness and profitability.

Okmetic's silicon wafers are part of a further processing chain that produces end products that improve human interaction and quality of life. Okmetic's products are based on high-tech expertise that generates added value for customers, innovative product development and an extremely efficient production process. 

Okmetic has a global customer base and sales network, production plants in Finland and the US and contract manufacturers in Japan and China. Okmetic's shares are listed on Nasdaq Helsinki under the code OKM1V. For more information on the company, please visit our website at www.okmetic.com.




This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Okmetic Oyj via Globenewswire

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