Ahlstrom interim report January-June 2009. Second quarter EBIT
positive due to implemented actions
(Thomson Reuters ONE) - Ahlstrom Corporation STOCK EXCHANGE RELEASE 24.7.2009April-June 2009 compared to April-June 2008:* Net sales were EUR 398.9 million (465.9).* EBIT amounted to EUR 9.7 million (19.4). The figure includes non-recurring items of EUR -3.0 million (-0.1).* Profit before taxes was EUR 4.7 million (14.2) and earnings per share were EUR 0.05 (0.22)* Net cash from operating activities increased to EUR 72.8 million (5.4).January-June 2009 compared to January-June 2008:* Net sales were EUR 775.0 million (932.2).* Operating loss amounted to EUR 1.0 million (operating profit of 38.7). The figure includes non-recurring items of EUR -3.7 million (0.8).* Loss before taxes was EUR 13.9 million (profit before taxes of 25.4) and earnings per share were EUR -0.21 (0.37).* Net cash from operating activities increased to EUR 93.7 million (46.1).Events in April-June 2009* A new restructuring program of EUR 50 million was announced on April 29, 2009. The full effect of the program will be visible in 2010.* The company initiated a project to decrease cash tied up in working capital. The aim is to decrease the working capital by EUR 100 million in two years.* The maturity structure of the loan portfolio was extended by new medium-term bilateral loan facility agreements of EUR 55 million. Ahlstrom also finalized an agreement on the refinancing of a credit facility of EUR 200 million expiring at the end of 2009. The new financing agreement of EUR 200 million was signed after the review period on July 15, 2009.Outlook for 2009* The market environment will continue to be challenging and difficult to forecast. The demand for Ahlstrom products revived slightly in the second quarter, but it is anticipated to continue at a low level.Jan Lång, President & CEO, comments on January-June 2009:- In a continuously challenging market situation we managedto reach a profitable April-June EBIT by restructuring ouroperations. The streamlining measures and cost reductions in thefirst months are visible in the result. In addition, raw materialprices decreased and market demand picked up slightly toward the endof the period. We have also successfully focused on improving ourcash flow and decreased our net liabilities by almost EUR 30 millionsince the turn of the year. In addition, we have strengthened thecompany's funding base with the support of our relationship banks.Thanks to the new financing arrangements, the company's financingrests on a solid base.KEY FIGURES+----------------------------------------------------------------------+|EUR million | 4-6/| 4-6/|Change,| 1-6/| 1-6/|Change,|| | 2009| 2008| %| 2009| 2008| %||------------------------------+-----+-----+-------+-----+-----+-------||Net sales |398.9|465.9| -14.4|775.0|932.2| -16.9||------------------------------+-----+-----+-------+-----+-----+-------||EBIT (Operating profit/loss) | 9.7| 19.4| -49.8| -1.0| 38.7| -||------------------------------+-----+-----+-------+-----+-----+-------||Profit/loss before taxes | 4.7| 14.2| -67.0|-13.9| 25.4| -||------------------------------+-----+-----+-------+-----+-----+-------||Profit for the period | 2.5| 10.6| -76.5| -9.9| 18.4| -||------------------------------+-----+-----+-------+-----+-----+-------||Earnings per share | 0.05| 0.22| -77.3|-0.21| 0.37| -||------------------------------+-----+-----+-------+-----+-----+-------||Return on capital employed | | | | | | ||(ROCE), % | 3.2| 6.3| -| -0.1| 6.3| -||------------------------------+-----+-----+-------+-----+-----+-------||Equity ratio, % | 37.9| 41.6| -| 37.9| 41.6| -||------------------------------+-----+-----+-------+-----+-----+-------||Gearing ratio, % | 92.0| 76.0| -| 92.0| 76.0| -||------------------------------+-----+-----+-------+-----+-----+-------||Interest-bearing net | | | | | | ||liabilities |569.5|547.7| 4.0|569.5|547.7| 4.0||------------------------------+-----+-----+-------+-----+-----+-------||Investments (excluding | | | | | | ||acquisitions) | 14.6| 33.1| -56.0| 41.5| 54.1| -23.2||------------------------------+-----+-----+-------+-----+-----+-------||Net cash from operating | | | | | | ||activities | 72.8| 5.4| -| 93.7| 46.1| -||------------------------------+-----+-----+-------+-----+-----+-------||Number of employees, average |6,023|6,538| -7.9|6,104|6,538| -6.6||------------------------------+-----+-----+-------+-----+-----+-------||Number of employees, at the | | | | | | ||end of the period |5,992|6,568| -8.8|5,992|6,568| -8.8|+----------------------------------------------------------------------+OPERATING ENVIRONMENTThe very challenging market conditions that emerged during the lastquarter of 2008 prevailed during the first two quarters of 2009, andthe demand for most of Ahlstrom's products was weak. However, theweakening of the demand stopped and the demand for some productspicked up toward the end of the review period.In the Fiber Composites segment*, the demand for Ahlstrom's productsin the automotive, construction, marine and windmill industriescontinued to be exceptionally weak due to the global recession. Thewindmill application market was slow, especially due to the financingproblems of new wind power plants. The Filtration business area wasburdened by a significant slowdown in the servicing of passenger andfreight transport vehicles along with the decrease in new vehicleproduction. The demand for wipes was weak as well. However, thedemand for filters and wipes revived slightly during the secondquarter. Market demand for food packaging and teabag materials aswell as for nonwovens in medical applications was close to the levelof early 2008.In the Specialty Papers segment*, the market demand in automotive,furniture, textile as well as in release and labeling industries,continued to suffer from the severe recession. Yet the demand pickedup slightly during the second quarter of 2009.The decrease in the market prices of Ahlstrom's main raw materials,natural and synthetic fibers and chemicals, started to level off andpartly turned to an increase at the end of the reporting period.DEVELOPMENT OF NET SALES+-------------------------------------------------------------------+| Net sales by | 4-6/ | 4-6/ | Change, | 1-6/ | 1-6/ | Change, || segment | 2009 | 2008 | % | 2009 | 2008 | % || and business | | | | | | || area | | | | | | ||---------------+-------+-------+---------+-------+-------+---------|| Fiber | | | | | | || Composites | 212.4 | 257.0 | -17.4 | 421.2 | 509.0 | -17.2 ||---------------+-------+-------+---------+-------+-------+---------|| Advanced | | | | | | || Nonwovens | 44.3 | 46.2 | -4.0 | 89.7 | 90.8 | -1.3 ||---------------+-------+-------+---------+-------+-------+---------|| | | | | | | || Filtration | 69.5 | 82.9 | -16.1 | 134.5 | 162.7 | -17.4 ||---------------+-------+-------+---------+-------+-------+---------|| Glass & | | | | | | || Industrial | | | | | | || Nonwovens | 42.7 | 63.7 | -32.9 | 87.2 | 128.0 | -31.8 ||---------------+-------+-------+---------+-------+-------+---------|| Home & | | | | | | || Personal | | | | | | || Nonwovens | 58.0 | 67.8 | -14.5 | 114.3 | 133.6 | -14.4 ||---------------+-------+-------+---------+-------+-------+---------|| Specialty | | | | | | || Papers | 188.2 | 209.7 | -10.2 | 358.3 | 426.7 | -16.0 ||---------------+-------+-------+---------+-------+-------+---------|| Release & | | | | | | || Label Papers | 70.4 | 79.3 | -11.2 | 133.7 | 160.4 | -16.6 ||---------------+-------+-------+---------+-------+-------+---------|| Technical | | | | | | || Papers | 118.3 | 130.4 | -9.3 | 225.0 | 266.3 | -15.5 ||---------------+-------+-------+---------+-------+-------+---------|| Other | | | | | | || functions* | | | | | | || and | | | | | | || eliminations | -1.7 | -0.7 | - | -4.5 | -3.6 | - ||---------------+-------+-------+---------+-------+-------+---------|| Total net | | | | | | || sales | 398.9 | 465.9 | -14.4 | 775.0 | 932.2 | -16.9 |+-------------------------------------------------------------------+* Other functions include financing and taxation-related receivables,liabilities and cost items, as well as earnings, costs, assets andliabilities belonging to holding and sales companies.Development of net sales in April-June 2009The weakening of the sales of most of Ahlstrom's products stabilizedduring the second quarter and the sales of certain products revived.Net sales for April-June amounted to EUR 398.9 million (EUR 465.9million). This was 14.4% down on April-June 2008 but up 6.1% from thefirst quarter.Net sales of the Fiber Composites segment amounted to EUR 212.4million (EUR 257.0 million), representing 53% of the Group net sales.The segment's net sales decreased by 17.4% from April-June 2008. Netsales were reduced in all business areas due to lower volumes in mostproducts. The steepest fall was seen in the Glass & IndustrialNonwovens business area (-32.9%) while net sales in the AdvancedNonwovens area were close to the figures of the comparison period(-4.0%). However, compared to the first quarter of 2009, net salesincreased by 1.7%, mainly due to a revival of demand in theFiltration and Home & Personal Nonwovens business areas.Net sales of the Specialty Papers segment amounted to EUR 188.2million (EUR 209.7 million), representing 47% of the Group net sales.The segment's net sales decreased by 10.2% compared to April-June2008. Net sales were reduced in both business areas, the Release &Label Papers (-11.2%) and Technical Papers (-9.3%). Nevertheless, thesituation improved compared to the first quarter of 2009. Net salesin both business areas increased by approximately 11% mainly due to arevival of demand.Development of net sales in January-June 2009The strong decline in the demand for most of Ahlstrom's products,which started at the end of 2008, stabilized during the secondquarter. Due to the weak first quarter, Group net sales forJanuary-June amounted to EUR 775.0 million, decreasing by 16.9%compared to the same period last year (EUR 932.2 million).Net sales of the Fiber Composites segment amounted to EUR 421.2million (EUR 509.0 million), representing 54% of the Group net sales.The segment's net sales decreased by 17.2% compared to January-June2008. Net sales were reduced in all business areas due to lowervolumes in most products. The steepest fall was seen in the Glass &Industrial Nonwovens business area (-31.8%), which suffered from aslowdown in the construction and wind power industries. Net sales inthe Advanced Nonwovens business area was close to the level of thecomparison period (-1.3%).Net sales of the Specialty Papers segment amounted to EUR 358.3million (EUR 426.7 million), representing 46% of the Group net sales.The segment's net sales decreased by 16.0% compared to January-June2008. Net sales were reduced in both business areas, the Release &Label Papers (-16.6%) and Technical Papers(-15.5%).RESULT AND PROFITABILITY+-------------------------------------------------------------------+| Financial result | 4-6/ | 4-6/ | Change, | 1-6/ | 1-6/ | Change, || by segment | 2009 | 2008 | % | 2009 | 2008 | % ||-------------------+------+------+---------+------+------+---------|| Fiber Composites | | | | | | ||-------------------+------+------+---------+------+------+---------|| EBIT (Operating | | | | | | || profit/loss) | 5.3 | 16.8 | -68.2 | 2.9 | 32.3 | -91.2 ||-------------------+------+------+---------+------+------+---------|| EBIT (Operating | | | | | | || profit/loss), % | 2.5 | 6.5 | - | 0.7 | 6.3 | - ||-------------------+------+------+---------+------+------+---------|| Return on net | | | | | | || assets, | | | | | | || RONA, % | 2.7 | 8.7 | - | 0.7 | 8.2 | - ||-------------------+------+------+---------+------+------+---------|| Specialty Papers | | | | | | ||-------------------+------+------+---------+------+------+---------|| EBIT (Operating | | | | | | || profit/loss) | 6.8 | 4.7 | 45.2 | 3.4 | 10.2 | -66.1 ||-------------------+------+------+---------+------+------+---------|| EBIT | | | | | | || (Operating | | | | | | || profit/loss), % | 3.6 | 2.2 | - | 1.0 | 2.4 | - ||-------------------+------+------+---------+------+------+---------|| Return on net | | | | | | || assets, | | | | | | || RONA, % | 6.8 | 4.1 | - | 1.7 | 4.4 | - ||-------------------+------+------+---------+------+------+---------|| Other functions* | | | | | | || and eliminations | | | | | | ||-------------------+------+------+---------+------+------+---------|| Operating | | | | | | || profit/loss | -2.4 | -2.0 | - | -7.3 | -3.8 | - ||-------------------+------+------+---------+------+------+---------|| Ahlstrom Group | | | | | | || total | | | | | | ||-------------------+------+------+---------+------+------+---------|| EBIT | | | | | | || (Operating | | | | | | || profit/loss) | 9.7 | 19.4 | -49.8 | -1.0 | 38.7 | -102.6 ||-------------------+------+------+---------+------+------+---------|| EBIT | | | | | | || (Operating | | | | | | || profit/loss), | | | | | | || % | 2.4 | 4.2 | - | -0.1 | 4.2 | - ||-------------------+------+------+---------+------+------+---------|| ROCE, % | 3.2 | 6.3 | - | 0.1 | 6.3 | - |+-------------------------------------------------------------------+* Other functions include financing and taxation-related receivables,liabilities and cost items, as well as earnings, costs, assets andliabilities belonging to holding and sales companies.Result and profitability in April-June 2009Ahlstrom's streamlining measures and the revival in demand began toshow in the Group's profitability during the second quarter. EBIT wasEUR 9.7 million (EUR 19.4 million), an improvement compared to theoperating loss of EUR 10.7 million in the first quarter. The figureincludes non-recurring items of EUR -3.0 million (EUR -0.1 million).A decrease in the prices of raw materials and implementedstreamlining measures contributed to the result, but the performancewas burdened by lower sales volumes compared to April-June 2008, achange in the geographical distribution of sales and increased pricepressures due to the global recession.EBIT of the Fiber Composites segment amounted to EUR 5.3 million (EUR16.8 million). The figure includes non-recurring items of EUR -2.0million (EUR 1.5 million). Most of the weak performance compared toApril-June 2008 was due to weakened demand. The Glass & IndustrialNonwovens business area saw the steepest decrease in sales.EBIT of the Specialty Papers segment amounted to EUR 6.8 million (EUR4.7 million), EUR 2.1 million better than a year before. The figureincludes non-recurring items of EUR -0.5 million (EUR -1.0 million).The profitability was especially improved by the streamliningactivities and earlier restructuring measures carried out in theRelease & Label Papers business area.Result and profitability in January-June 2009The Group EBIT was narrowly negative, EUR -1.0 million (profit of EUR38.7 million). Decreases in raw material prices and implementedstreamlining measures improved the result. A general decrease insales volumes compared to the comparison period and increased pricepressure due to the global recession burdened the result.Non-recurring items in January-June totaled EUR -3.7 million (EUR 0.8million), comprising mainly costs related to restructuring andreductions of personnel. The most significant item was arestructuring charge of EUR 1.4 million connected with the Bethuneplant in the United States booked in the second quarter in the Home &Personal Nonwovens business area.EBIT of the Fiber Composites segment decreased to EUR 2.9 million(EUR 32.3 million). Non-recurring items amounted to EUR -2.7 million(EUR 2.0 million).The main reason for the weakened performance was the decrease in netsales. The Glass & Industrial Nonwovens business area saw thesteepest decrease in sales.EBIT of the Specialty Papers segment decreased to EUR 3.4 million(EUR 10.2 million). Non-recurring items amounted to EUR -0.5 million(EUR -0.7 million).The main reason for the weakened performance was decreased sales inboth business areas, Release & Label Papers as well as TechnicalPapers.Ahlstrom took an active approach in adjusting its daily production tothe weak demand. The utilization of downtime in production due tomarket reasons was 22.8% in January-June 2009 compared to 6.5% duringthe corresponding period in 2008. Ahlstrom pursued temporary layoffsand other flexible working hour solutions in different countriesdepending on the market conditions. Globally, approximately 2,100employees were affected by the temporary layoffs and short-timeprograms during the second quarter.Total fixed costs decreased by 4.0% from January-June 2008 as aresult of cost control and implemented streamlining measures.Total net financial expenses were EUR 13.0 million (EUR 13.3 millionin January-June 2008). The financial expenses include net interestexpenses of EUR 12.4 million (EUR 11.6 million), exchange rate gainsof EUR 0.2 million (losses of EUR 0.2 million) and other financialexpenses of EUR 0.8 million (EUR 1.5 million).Loss before taxes was EUR 13.9 million (profit before taxes of EUR25.4 million).Tax income amounted to EUR 4.0 million (income tax expenses of EUR7.0 million).Loss for the period was EUR 9.9 million (profit of EUR 18.4 million)and earnings per share (EPS) weakened to EUR -0.21 (EUR 0.37).Return on capital employed (ROCE) amounted to -0.1% (6.3%), andreturn on equity (ROE) to -3.2% (5.0%).FINANCINGIn January-June 2009, net cash flow from operating activitiesamounted to EUR 93.7 million (EUR 46.1 million in January-June 2008).The cash flow was significantly improved by reduced working capital,to which particular attention has been paid since the beginning ofthe year. Operative working capital decreased by EUR 50.4 millioncompared to the end of 2008.Interest-bearing net liabilities decreased by EUR 29.2 million fromturn of the year to EUR 569.5 million (December 31, 2008: EUR 598.7million). Ahlstrom's interest bearing liabilities amounted to EUR602.1 million on June 30, 2009. Of the loan portfolio, approximately12% was tied to a fixed interest rate using interest ratederivatives, and the duration of the loan portfolio (average interestrate tying period) was 4.9 months. The average interest rate of theloan portfolio was approximately 2.4%.The gearing ratio was 92.0% (December 31, 2008: 95.3%) and equityratio 37.9% (December 31, 2008: 36.8%).During the review period, Ahlstrom extended the maturity structure ofits loan portfolio by making agreements on new medium term bilateralloan facilities amounting to EUR 55 million. In addition, the companywas in the process of finalizing the refinancing of the medium termrevolving credit facility expiring in November 2009. The newthree-year financing agreement of EUR 200 million was signed afterthe review period on July 15, 2009.PERSONNELThe number of Ahlstrom employees during January-June was 6,104(6,538) on average and at the end of June, 5,992 (6,568). Theheadcount was decreased due to the programs announced in January andApril 2009 as well as some restructuring actions taken in 2008,mainly the closure of the Ascoli plant in Italy. At the end of June,the highest numbers of employees were in the United States (24%),France (20%), Italy (13%), Finland (11%) and Germany (9%).CAPITAL EXPENDITUREAhlstrom did not make any major investment decisions during the firsttwo quarters of 2009. Ahlstrom's capital expenditure for January-Junetotaled EUR 41.5 million (EUR 54.1 million excluding acquisitions inJanuary-June 2008). The largest on-going investment project is theconstruction of a medical nonwovens plant in Gujarat, India,amounting to EUR 38 million in total. Operations at the plant areestimated to start in the first quarter of 2010. The project hasproceeded according to plans. The buildings are completed, andinstallation of production equipment has begun.At the Turin plant in Italy, the company completed an investmentproject in which one paper machine was converted to produceinnovative nonwovens used in wallpaper materials. The first samplebatches were delivered to customers at the end of June. The newproduction line uses both natural and synthetic fibers. Thanks to theinvestment, Ahlstrom's wallpaper material assortment becomes the mostcomprehensive on the market.Investments in 2009 are estimated to be approximately EUR 70 million(EUR 167.0 million in 2008, or EUR 128.0 million excludingacquisitions).STREAMLINING PROGRAMSRestructuring programsOn January 7, 2009, Ahlstrom announced global restructuring plans torespond to the decrease in demand. The company decided to takeseveral measures to improve profitability and adjust its operationsto the challenging market situation. Of the planned permanent layoffsof 210 people, a total of 122 had been laid off until the end ofJune. In addition, there were temporary layoffs at production sitesas well as in the headquarters and production was cut down in severalcountries by taking market related downtime*. The program alsoinvolved the closing down of unprofitable operations in Italy, whichthe company announced on July 6, 2009.Ahlstrom announced on April 29, 2009, that it was to initiate a newrestructuring program (profit improvement program), aiming at annualsavings of EUR 50 million. The savings are estimated to have fulleffect in 2010. The cost of the program is estimated to beapproximately EUR 40 million in 2009, of which 50% will becash-related. In connection with the program, the company iscurrently reviewing its cost structure and underperforming units. Therestructuring may impact 400 to 500 Ahlstrom employees globally.The program, initiated in April, is proceeding according to plans.With regard to the personnel cuts included in the program, a total of138 employees had been laid off by the end of June. In June, thecompany decided to permanently close down a production line at theplant in Bethune, USA, and move its production to Green Bay, USA. Theproduction line belonged to the Home & Personal Nonwovens businessarea, producing wipes. Personnel cuts made as a result of the closingdown will amount to 65 employees, mostly during the third quarter.Optimization of working capitalA project to improve the turnover of working capital initiated with apilot stage early this year proceeded according to plans. The projectaims at decreasing the working capital by EUR 100 million over twoyears. So far, the project has been started in eight plants, and inthe next few months, it will be expanded to most production sites andfunctions. Between the end of 2008 and the end of June, the operativeworking capital decreased by EUR 50.4 million with turnover improvingby 8 days.Strategy review processAhlstrom announced on April 29, 2009, that it had begun a strategyreview process with the aim of verifying the future direction andambitions of the company. Conclusions can be expected towards the endof 2009.AUTHORIZATIONS OF THE BOARDAhlstrom Corporation's Annual General Meeting of Shareholders (AGM)held on March 25, 2009 authorized the Board of Directors torepurchase Ahlstrom shares. The maximum number of shares to bepurchased is 4,500,000. The shares may be repurchased only throughpublic trading at the prevailing market price by using unrestrictedshareholders' equity.The AGM also authorized the Board of Directors to distribute amaximum of 4,500,000 own shares held by the Company. The Board ofDirectors is authorized to decide to whom and in which order theshares will be distributed. The shares may be used as considerationin acquisitions and in other arrangements as well as to implement theCompany's share-based incentive plans in the manner and to the extentdecided by the Board of Directors. The Board of Directors also hasthe right to decide on the distribution of the shares in publictrading for the purpose of financing possible acquisitions.The authorizations are valid for 18 months from the close of theAnnual General Meeting but will, however, expire at the close of thenext Annual General Meeting, at the latest.SHARES AND SHARE CAPITALAhlstrom's share is listed on the NASDAQ OMX Helsinki. Ahlstrom hasone series of shares. The share is classified under NASDAQ OMX'sMaterials sector and the trading code is AHL1V.During January-June 2009, a total of 2.4 million Ahlstrom shares weretraded for a total of EUR 16.3 million. The lowest trading priceduring the review period was EUR 6.15 and the highest EUR 8.48. Theclosing price on June 30, 2009 was EUR 6.33 and market capitalizationwas EUR 295.4 million on June 30, 2009.Ahlstrom Group's equity per share was EUR 13.26 at the end of thereview period (December 31, 2008: EUR 13.46).Ahlstrom has not used the AGM authorization to repurchase ordistribute company shares.CHANGES IN THE SHARE-BASED INCENTIVE PLANIn May 2009, Ahlstrom's Board of Directors approved two changes to ashare-based long term incentive plan for the Corporate Executive Team(CET), announced on February 1, 2008.According to the original announcement, the plan will comprise threeearning periods of three calendar years (2008, 2009 and 2010). Due tothe global recession, the Board decided in May 2009 to merge theearning periods 2009 and 2010 into one period, 2010. Thus the targetsetting for the remaining time in the program will be made only for2010. The share allocations of 2009 and 2010 will be combinedaccordingly.The plan offers a possibility to receive Ahlstrom shares and cash(equaling the amount of taxes of the total reward) as a reward, ifthe targets set by the Board for each earning period are achieved. InMay 2009, the evaluation criterion was changed from earnings pershare (EPS) to return on capital employed (ROCE).EVENTS AFTER THE REVIEW PERIODRestructuring in ItalyAhlstrom announced on July 6, 2009 that it had concluded itsco-operation negotiations with the representatives of the personnelregarding the restructuring of Home & Personal Nonwovens businessarea in Italy. The company announced that it will close down theGallarate plant as well as one production line in Cressa due to lowmarket demand and weak long-term profitability. Contrary to theoriginal announcement on January 7, 2009, the Carbonate plant willnot be closed. The reduction impact on personnel in all three plants,including also the Carbonate plant, is 48. All three plants producenonwoven wipes.The closures are connected with the restructuring program initiatedin January 2009, ie they are not included in the restructuringprogram announced at the end of April.Non-recurring expenses related to the closures are EUR 19 million, ofwhich EUR 5.2 million have a cash flow effect. The non-recurringexpenses have been booked in Ahlstrom's fourth quarter 2008 financialresults.New financing agreementA new EUR 200 million medium term financing agreement was signed onJuly 15, 2009. The new credit facility replaces an existingcorresponding revolving credit facility expiring in November. Thecredit facility will be used for general corporate financing purposesand refinancing of the existing credit facility.The terms and conditions of the facility agreement contain customarycovenants and undertakings including the requirement to maintaincertain net debt to equity ratios. Dividend payments and otherdistributions to shareholders will also be restricted. As a result ofthese restrictions dividend payments and other distributions will besubject to an equity injection, or the issuance of other instrumentstreated as equity under IFRS or other agreed subordinated debtinstruments sufficient for Ahlstrom to reduce its net debt to equityratio by approximately 20 percentage points as calculated based onthe company's balance sheet at the end of the first quarter of 2009,as well as to sufficient cash flow. The restrictions do not apply todividends that become payable under law (minority dividend).In the transaction, Nordea, Pohjola Bank and Skandinaviska EnskildaBanken (SEB) acted as mandated lead arrangers and bookrunners. Theother participants are DnB NORD, Sampo Bank and BNP Paribas.OUTLOOKIn 2009, the market environment is anticipated to continue to bechallenging and difficult to forecast. Therefore, Ahlstrom changedits disclosure policy at the beginning of 2009. During a period ofmajor uncertainty, the outlook only includes forecasts of thebusiness and market environment. Forecasts of net sales developmentwill be included when the predictability of the operating environmenthas returned to the previous level.The market demand for Ahlstrom products revived slightly in thesecond quarter, but it is anticipated to continue at a low level. Inaddition to the restructuring programs announced in January andApril, the company will adjust its operations to the market situationas necessary.SHORT-TERM RISKSThe continued global recession will create several factors ofuncertainty that might impact Ahlstrom's business. Production mayneed to be cut more than planned, and the risk of a steeper decreasein sales prices will increase if weak demand continues. Due to theweakening economy, customers' credit risks have increased and aremore difficult to insure.In addition, after decreasing during the first months of the year,raw material prices have begun to show the first signs of anincrease. The prices of several raw materials used by Ahlstrom beganto increase towards the end of the review period and have continuedto increase thereafter.If the challenging market conditions persist, they may prolong thepayback period of the EUR 500 million investment program carried outby Ahlstrom in 2007 and 2008.The general risks of Ahlstrom's business operations are described inmore detail in Ahlstrom's annual report 2008 on pages 24 to 29, andon the Internet at www.ahlstrom.com. * * *This interim report has been prepared in accordance with theInternational Financial Reporting Standards (IFRS). Comparablefigures refer to the same period last year unless otherwise stated.The report is unaudited.This report contains certain forward-looking statements that reflectthe present views of the company's management. The statements containuncertainties and risks and are thus subject to changes in thegeneral economic situation and in the company's business.Helsinki, July 24, 2009Ahlstrom CorporationBoard of DirectorsADDITIONAL INFORMATIONJan Lång, President & CEO, tel. +358 10 888 4700Seppo Parvi, CFO, tel. +358 10 888 4768Ahlstrom's President & CEO Jan Lång will present the second quarterresults in Finnish in a press conference in Helsinki on July 24, 2009at 10:00 a.m. Finnish time. The conference for media and analystswill take place at Hotel Scandic Simonkenttä, address Simonkatu 9,meeting room Bulsa & Freda on the street level. You are welcome toattend.In addition, a conference call for analysts and investors will beheld in English on July 24, 2009 at 1:00 p.m. Finnish time. Thediscussion will be led by President & CEO Jan Lång. To participate inthe teleconference, please dial +358 9 2312 9202 a few minutes beforethe call. Use the title of the conference call: Ahlstrom conferencecall. A replay number is available until July 31, 2009. The numberfor the replay is+358 9 2314 4681, access code: 840949.The presentation material will be available at www.ahlstrom.com >Investors > IR presentations on July 24, 2009 after the interimreport has been published.AHLSTROM'S FINANCIAL INFORMATION IN 2009Ahlstrom Corporation will publish its interim report forJanuary-September on Wednesday, October 28, 2009.Distribution:NASDAQ OMX Helsinkiwww.ahlstrom.comMain mediaAhlstrom in briefAhlstrom is a global leader in the development, manufacture andmarketing of high performance nonwovens and specialty papers.Ahlstrom's products are used in a large variety of applications, suchas filters, wipes, flooring, labels, and tapes. Based upon its uniquefiber expertise and innovative approach, the company has a strongmarket position in several business areas in which it operates.Ahlstrom's 6,000 employees serve customers via sales offices andproduction facilities in more than 20 countries on six continents. In2008, Ahlstrom's net sales amounted to EUR 1.8 billion. Ahlstrom'sshare is quoted on the NASDAQ OMX Helsinki. The company website is atwww.ahlstrom.com.APPENDIXConsolidated financial statementsAPPENDIXCONSOLIDATED FINANCIAL STATEMENTSFinancial Statements are unaudited.INCOME STATEMENT Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2009 2008 2008Net sales 398.9 465.9 775.0 932.2 1,802.4Other operating income 3.5 4.3 6.1 7.3 18.7Expenses -366.7 -426.9 -730.9 -852.9 -1,694.2Depreciation, amortization andimpairment charges -25.9 -23.9 -51.3 -47.9 -112.3Operating profit / loss 9.7 19.4 -1.0 38.7 14.6Net financial expenses -4.8 -4.7 -13.0 -13.3 -34.2Share of profit / loss ofassociated companies -0.3 -0.6 0.1 -0.0 -1.1Profit / loss before taxes 4.7 14.2 -13.9 25.4 -20.6Income taxes -2.2 -3.6 4.0 -7.0 4.5Profit / loss for the period 2.5 10.6 -9.9 18.4 -16.1Attributable toOwners of the parent 2.5 9.9 -9.9 17.1 -17.9Minority interest - 0.7 - 1.3 1.8Basic and dilutedearnings per share, EUR 0.05 0.22 -0.21 0.37 -0.38STATEMENT OF COMPREHENSIVE INCOME Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2009 2008 2008Profit / loss for the period 2.5 10.6 -9.9 18.4 -16.1Other comprehensive income, net of tax:Translation differences 11.9 13.7 21.3 -6.8 -37.1Hedges of net investments in foreignoperations 1.3 0.7 0.4 4.6 6.4Cash flow hedges 0.1 0.7 0.1 0.4 -1.2Other comprehensive income, net of tax 13.3 15.1 21.8 -1.9 -32.0Total comprehensive income for the period 15.8 25.6 11.9 16.5 -48.1Attributable toOwners of the parent 15.8 21.7 11.9 14.0 -52.8Minority interest - 3.9 - 2.5 4.7BALANCE SHEET Jun 30, Jun 30, Dec 31,EUR million 2009 2008 2008ASSETSNon-current assetsProperty, plant and equipment 750.1 738.6 745.7Goodwill 173.6 179.4 169.1Other intangible assets 52.9 56.7 51.6Investments in associated companies 11.5 12.4 11.4Other investments 0.2 0.2 0.2Other receivables 17.6 16.7 15.6Deferred tax assets 44.4 31.2 40.4Total non-current assets 1,050.3 1,035.1 1,033.9Current assetsInventories 206.8 256.9 252.5Trade and other receivables 342.7 415.3 356.2Income tax receivables 3.1 4.1 6.3Other investments - 0.0 0.0Cash and cash equivalents 32.6 20.1 58.2Total current assets 585.3 696.4 673.2Total assets 1,635.5 1,731.5 1,707.0EQUITY AND LIABILITIESEquity attributable to owners of the parent 619.0 683.0 628.1Minority interest - 37.8 0.0Total equity 619.0 720.8 628.1Non-current liabilitiesInterest-bearing loans and borrowings 196.1 290.2 188.7Employee benefit obligations 84.5 84.9 84.6Provisions 4.5 4.1 4.4Other liabilities 0.1 0.2 0.2Deferred tax liabilities 18.8 27.2 16.5Total non-current liabilities 303.9 406.7 294.4Current liabilitiesInterest-bearing loans and borrowings 406.0 277.6 468.1Trade and other payables 290.5 296.8 293.3Income tax liabilities 2.7 7.3 3.5Provisions 13.3 22.3 19.7Total current liabilities 712.5 604.0 784.5Total liabilities 1,016.5 1,010.7 1,078.9Total equity and liabilities 1,635.5 1,731.5 1,707.0STATEMENT OF CHANGES IN EQUITY1) Issued capital2) Share premium3) Non-restricted equity reserve4) Hedging reserve5) Translation reserve6) Retained earnings7) Minority interest8) Total equity Attributable to owners of the parentEUR million 1) 2) 3) 4) 5) 6) 7) 8)Equity at January 1,2008 70.0 209.3 8.3 0.0 -15.5 444.3 36.0 752.4Dividends paid andother - - - - - -46.7 - -46.7Purchases ofminority interest - - - - - -0.7 -0.7 -1.4Total comprehensiveincome for the period - - - 0.4 -3.5 17.1 2.5 16.5Equity at June 30,2008 70.0 209.3 8.3 0.4 -19.0 414.1 37.8 720.8Equity at January 1,2009 70.0 209.3 8.3 -1.2 -49.1 390.9 0.0 628.1Dividends paid andother - - - - - -21.0 - -21.0Purchases ofminority interest - - - - - - -0.0 -0.0Total comprehensiveincomefor the period - - - 0.1 21.7 -9.9 - 11.9Equity at June 30,2009 70.0 209.3 8.3 -1.1 -27.4 360.1 - 619.0STATEMENT OF CASH FLOWS Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2009 2008 2008Cash flow from operating activitiesProfit / loss for the period 2.5 10.6 -9.9 18.4 -16.1Adjustments, total 33.4 30.8 59.9 65.3 131.5Changes in net working capital 30.6 -10.4 56.4 -10.6 47.2Change in provisions -0.8 -11.3 -5.2 -19.8 -20.0Financial items 4.3 -7.0 -9.0 5.5 -16.8Taxes paid 2.9 -7.3 1.4 -12.7 -23.4Net cash from operating activities 72.8 5.4 93.7 46.1 102.4Cash flow from investing activitiesAcquisition of Group companies -0.0 - -0.0 -11.0 -39.0Purchases of intangible and tangibleassets -22.5 -32.9 -44.6 -57.2 -131.2Other investing activities 0.5 4.2 1.1 13.4 16.9Net cash from investing activities -22.0 -28.6 -43.5 -54.8 -153.4Cash flow from financing activitiesDividends paid -21.0 -46.7 -21.0 -46.7 -46.7Changes in loans and other financingactivities -14.2 60.2 -55.9 54.3 136.3Net cash from financing activities -35.2 13.5 -76.9 7.6 89.7Net change in cash and cashequivalents 15.6 -9.7 -26.8 -1.0 38.7Cash and cash equivalents at beginningof period 16.6 29.3 58.2 21.3 21.3Foreign exchange adjustment 0.4 0.5 1.2 -0.2 -1.7Cash and cash equivalents at end of period 32.6 20.1 32.6 20.1 58.2KEY FIGURES Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4 2009 2008 2009 2008 2008Operating profit, % 2.4 4.2 -0.1 4.2 0.8Return on capital employed(ROCE), % 3.2 6.3 -0.1 6.3 1.4Return on equity (ROE), % 1.6 5.8 -3.2 5.0 -2.3Interest-bearing netliabilities,EUR million 569.5 547.7 569.5 547.7 598.7Equity ratio, % 37.9 41.6 37.9 41.6 36.8Gearing ratio, % 92.0 76.0 92.0 76.0 95.3Earnings per share, EUR 0.05 0.22 -0.21 0.37 -0.38Equity per share, EUR 13.26 14.63 13.26 14.63 13.46Cash earnings per share, EUR 1.56 0.12 2.01 0.99 2.19Average number of sharesduringthe period, 1000's 46,671 46,671 46,671 46,671 46,671Number of shares at the endofthe period, 1000's 46,671 46,671 46,671 46,671 46,671Capital expenditure, EURmillion 14.6 33.1 41.5 54.1 128.0Capital employed, at the endofthe period, EUR million 1,221.2 1,288.6 1,221.2 1,288.6 1,285.0Number of employees, average 6,023 6,538 6,104 6,538 6,510ACCOUNTING PRINCIPLESThis interim report has been prepared in accordance with IAS 34,Interim Financial reporting, as adopted by EU and the accountingpolicies set out in the Group's Financial Statements for 2008 exceptfor the changes below.Changes in accounting principlesThe Group has adopted the following new or amended standards andinterpretations as of January 1, 2009:- IFRS 8 Operating segmentsThe Group has two reportable segments: the Fiber Composites segmentand the Specialty Papers segment.The adoption of IFRS 8 does not have an impact on reportablesegments.- Revised IAS 23 Borrowing costsThe Group has already earlier applied this accounting policy and theadoption of the revised standard has no impact on the consolidatedfinancial statements.- Amendment to IAS 1 A Revised presentationThe amendment has changed the presentation of financial statements.The income statement is presented in two statements: income statementand statement of comprehensive income. The statement of changes inequity includes only transactions with owners and all non-ownerchanges are presented in equity as a single line.The below mentioned new and amended standards and interpretations donot have an impact on the consolidated financial statements.- Amendment to IFRS 2 Share-based payment: Vesting Conditions andCancellations- Amendments to IAS 32 and IAS 1 Puttable Financial Instruments andObligations Arising on Liquidation- IFRIC 13 Customer Loyalty ProgrammesSEGMENT INFORMATION Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2009 2008 2008Fiber Composites 212.4 257.0 421.2 509.0 987.4Specialty Papers 188.2 209.7 358.3 426.7 822.4Other operations 4.6 4.2 7.2 9.4 20.2Internal sales -6.3 -5.0 -11.7 -13.0 -27.6Total net sales 398.9 465.9 775.0 932.2 1,802.4Fiber Composites 1.3 0.9 3.0 1.8 5.6Specialty Papers 0.7 1.8 2.0 4.5 9.0Other operations 4.3 2.3 6.7 6.7 12.9Total internal sales 6.3 5.0 11.7 13.0 27.6Fiber Composites 5.3 16.8 2.9 32.3 15.3Specialty Papers 6.8 4.7 3.4 10.2 10.2Other operations -2.5 -2.1 -7.4 -3.7 -10.7Eliminations 0.1 0.0 0.1 -0.1 -0.2Operating profit / loss 9.7 19.4 -1.0 38.7 14.6Fiber Composites 918.5 956.1 918.5 956.1 947.1Specialty Papers 597.6 680.7 597.6 680.7 609.2Other operations 23.1 29.3 23.1 29.3 30.4Eliminations -3.7 -10.5 -3.7 -10.5 -15.9Investments in associatedcompanies 11.5 12.4 11.5 12.4 11.4Unallocated assets 88.5 63.5 88.5 63.5 124.9Total assets 1,635.5 1,731.5 1,635.5 1,731.5 1,707.0Segment information is presented according to the IFRS standards.NET SALES BY REGION Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2009 2008 2008Europe 212.0 270.6 411.5 555.3 1015.9North America 102.8 110.1 208.5 212.7 442.5South America 42.4 45.1 79.2 87.6 189.2Asia-Pacific 35.7 30.6 62.5 58.3 119.4Rest of the world 6.0 9.6 13.3 18.2 35.5Total net sales 398.9 465.9 775.0 932.2 1,802.4CHANGES OF PROPERTY, PLANT ANDEQUIPMENT Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2008Book value at Jan 1 745.7 747.7 747.7Acquisitions through business combinations - 3.4 3.9Additions 41.2 53.9 118.7Disposals -0.5 -3.0 -3.7Depreciations and impairment charges -48.3 -45.1 -97.3Translation adjustment and other changes 11.9 -18.3 -23.5Book value at end of the period 750.1 738.6 745.7TRANSACTIONS WITH RELATED PARTIES Q1-Q2 Q1-Q2 Q1-Q4EUR million 2009 2008 2008Transactions with associated companiesSales and interest income 0.3 0.4 1.0Purchases of goods and services -1.1 -1.8 -3.6Trade and other receivables 1.5 0.1 2.6Trade and other payables 0.3 0.4 0.3Market prices have been used in transactions with associatedcompanies.OPERATING LEASES Jun 30, Jun 30, Dec 31,EUR million 2009 2008 2008Current portion 6.1 5.2 6.9Non-current portion 16.7 13.0 17.1Total 22.9 18.2 24.0CONTINGENT LIABILITIES Jun 30, Jun 30, Dec 31,EUR million 2009 2008 2008For own liabilitiesOther loansAmount of loans 0.3 0.8 0.5Book value of pledges 0.4 0.9 0.5For other own commitmentsGuarantees 39.2 18.7 38.7For commitments of associated companiesGuarantees 3.1 5.2 4.2Capital expenditure commitments 17.1 26.2 36.2Other contingent liabilities 3.5 4.2 4.7QUARTERLY DATA Q2 Q1 Q4 Q3 Q2 Q1EUR million 2009 2009 2008 2008 2008 2008Net sales 398.9 376.1 419.0 451.2 465.9 466.2Other operating income 3.5 2.7 5.6 5.8 4.3 3.1Expenses -366.7 -364.2 -419.8 -421.5 -426.9 -425.9Depreciation, amortization,impairment charges -25.9 -25.3 -40.2 -24.1 -23.9 -24.1Operating profit / loss 9.7 -10.7 -35.4 11.3 19.4 19.3Net financial expenses -4.8 -8.2 -13.8 -7.1 -4.7 -8.6Share of profit / loss ofassociated companies -0.3 0.4 -0.3 -0.7 -0.6 0.5Profit / loss before taxes 4.7 -18.6 -49.5 3.5 14.2 11.2Income taxes -2.2 6.2 12.4 -1.0 -3.6 -3.4Profit / loss for theperiod 2.5 -12.4 -37.0 2.5 10.6 7.8Attributable toOwners of the parent 2.5 -12.4 -37.0 2.0 9.9 7.2Minority interest - - - 0.5 0.7 0.6QUARTERLY DATA BY SEGMENT Q2 Q1 Q4 Q3 Q2 Q1EUR million 2009 2009 2008 2008 2008 2008Net salesFiber Composites 212.4 208.8 229.1 249.3 257.0 252.0Specialty Papers 188.2 170.1 191.6 204.0 209.7 217.0Other operations and eliminations -1.7 -2.8 -1.7 -2.1 -0.7 -2.8Group total 398.9 376.1 419.0 451.2 465.9 466.2Operating profit / lossFiber Composites 5.3 -2.5 -24.7 7.7 16.8 15.5Specialty Papers 6.8 -3.4 -6.5 6.5 4.7 5.5Other operations and eliminations -2.4 -4.9 -4.2 -2.9 -2.0 -1.7Group total 9.7 -10.7 -35.4 11.3 19.4 19.3KEY FIGURES QUARTERLY Q2 Q1 Q4 Q3 Q2 Q1EUR million 2009 2009 2008 2008 2008 2008Net sales 398.9 376.1 419.0 451.2 465.9 466.2Operating profit / loss 9.7 -10.7 -35.4 11.3 19.4 19.3Profit / loss before taxes 4.7 -18.6 -49.5 3.5 14.2 11.2Profit / loss for theperiod 2.5 -12.4 -37.0 2.5 10.6 7.8Gearing ratio, % 92.0 99.8 95.3 84.8 76.0 64.4Return on capital employed(ROCE), % 3.2 -3.3 -10.8 3.9 6.3 6.4Earnings per share, EUR 0.05 -0.26 -0.79 0.04 0.22 0.15Cash earnings per share,EUR 1.56 0.45 0.67 0.53 0.12 0.87Average number of sharesduring the period, 1000's 46,671 46,671 46,671 46,671 46,671 46,671CALCULATION OF KEY FIGURESInterest-bearing net liabilitiesInterest-bearing loans and borrowings - Cash and cash equivalents -Other investments (current)Equity ratio, %Total equity/ x 100Total assets - Advances receivedGearing ratio, %Interest-bearing netliabilities/ x 100Total equityReturn on equity (ROE), %Profit (loss) for the period/ x 100Total equity (annual average)Return on capital employed (ROCE), %Profit (loss) before taxes + Financingexpenses/ x 100Total assets (annual average) - Non-interest bearing liabilities(annual average)Earnings per share, EURProfit (loss) for the period attributable to equity holders ofthe parent/Average number of shares during the periodCash earnings per share, EURNet cash from operating activities/Average number of shares during the periodEquity per share, EUREquity attributable to equity holders of the parent/Number of shares at the end of the period*Ahlstrom's business is reported in two segments: the FiberComposites segment and the Specialty Papers segment. The FiberComposites segment comprises the Advanced Nonwovens, Filtration,Glass & Industrial Nonwovens and Home & Personal Nonwovens businessareas. The Specialty Papers segment covers the Release & Label Papersand Technical Papers business areas.*Ahlstrom's business is reported in two segments: the FiberComposites segment and the Specialty Papers segment. The FiberComposites segment comprises the Advanced Nonwovens, Filtration,Glass & Industrial Nonwovens and Home & Personal Nonwovens businessareas. The Specialty Papers segment covers the Release & Label Papersand Technical Papers business areas.**Market related downtime = downtime taken due to market reasons,lack of orders or too high product stock. Otherwise plants could haverun normally without any other downtime.Market related downtime % = market related downtime / manned time.Manned time = available time - unmanned time. Time the machines wererunning according to their shift system.http://hugin.info/132525/R/1330718/314652.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 24.07.2009 - 07:00 Uhr
Sprache: Deutsch
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