Kemira Oyj's Interim Report January-September 2009
(Thomson Reuters ONE) - Kemira GroupStock Exchange ReleaseOctober 28, 2009 at 12.00 noon (CET+1)Operating profit excluding non-recurring items up by 22%, very strongcash flowJanuary-September:* Revenue in January-September 2009 amounted to EUR 1,905.4 million (January-September 2008: EUR 2,205.1 million). Revenue from continuing business operations decreased by 7%.* Operating profit excluding non-recurring items rose by 22% to EUR 147.2 million (EUR 120.9 million). Operating profit excluding non-recurring items in continuing business operations was up by 28%.* Cash flows after investments grew significantly to EUR 175.3 million (EUR 65.7 million). Strong cash flow strengthened the balance sheet and gearing fell to 87% (Dec. 31, 2008: 107%).* Earnings per share: EUR 0.61 (EUR 0.55).* Kemira's revenue for October-December 2009 is expected to remain behind the previous year due to reduced demand in customer industries. Operating profit excluding non-recurring items is expected to grow from the EUR 11.7 million recorded a year earlier.Third quarter:* Revenue in July-September 2009 amounted to EUR 645.8 million (July-September 2008: EUR 780.0 million). Revenue from continuing business operations decreased by 13%.* Operating profit excluding non-recurring items rose by 16% to EUR 65.3 million (EUR 56.5 million). Operating profit excluding non-recurring items in continuing business operations was up by 22%.* Cash flows after investments were EUR 125.8 million (EUR 131.4 million, including the EUR 96.1 million associated with the set-up of the joint venture in the titanium dioxide business).* Earnings per share: EUR 0.33 (EUR 0.28).Key Figures and RatiosEUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 1-12/2008Revenue 645.8 780.0 1,905.4 2,205.1 2,832.7EBITDA 96.0 101.9 235.3 241.2 243.3EBITDA, % 14.9 13.1 12.3 10.9 8.6Operating profit,excluding 65.3 56.5 147.2 120.9 132.6non-recurring itemsOperating profit 65.3 69.8 144.8 142.1 74.0Operating profit,excluding 10.1 7.2 7.7 5.5 4.7non-recurring items, %Operating profit, % 10.1 8.9 7.6 6.4 2.6Financial income and -11.0 -20.7 -37.7 -45.8 -69.5expensesProfit before tax 53.8 48.8 101.6 96.3 1.8Profit before tax, % 8.3 6.3 5.3 4.4 0.1Net profit 40.6 35.4 76.2 70.3 1.8EPS, EUR 0.33 0.28 0.61 0.55 -0.02Capital employed* 2,009.2 2,043.2 2,009.2 2,043.2 2,062.8ROCE %* 3.4 4.9 3.4 4.9 3.5Cash flows after 65.7investments 125.8 131.4 175.3 2.7Equity ratio, % at 40period-end 37 40 37 34Gearing, % at 87period-end 87 87 87 107Personnel at period-end 8,561 9,392 8,561 9,392 9,405* 12-month rolling averageKemira's President and CEO Harri Kerminen:"This year, Kemira has sharply focused on improving its cash flow. InJanuary-September, cash flows after investments were very strong, EUR175 million. Reasons for this were, among other things, effectiveworking capital management, higher EBITDA, and smaller capitalexpenditure. With the strong cash flow, our gearing fell considerablyand reached 87% at the end of September, which is already close toour target level of 40-80%.Sales volumes have declined this year as demand has shrunk in severalcustomer industries, but this downward trend appears to have halted.Despite the fall in revenue, operating profit excluding non-recurringitems in continuing businesses rose by 22% in the third quarter fromthe same period a year earlier. This is due in large part toefficiency improvement measures, fixed cost management, and lowervariable costs compared to the same period last year. The Municipal &Industrial segment (previously Water) was able to significantlystrengthen its operating profit and cash flow. In July-September,Kemira's operating profit excluding non-recurring items accounted for10% of revenue compared with 7% a year earlier. Our medium-termtarget level for operating profit as a percentage of revenue is 10%.Kemira's vision is to be a leading water chemistry company.Operational efficiency enhancement, profitability improvement andstronger cash flows and balance sheet continue to be our key focusareas, but we are gradually taking steps to also accelerate revenuegrowth. Our organic growth objective is 5% per year."A conference for analysts and the media:Kemira will arrange a press conference for analysts and the mediatoday on October 28, 2009 starting at 1:00 p.m. at Kemira House,Porkkalankatu 3, Helsinki. The press conference will be held inFinnish. Harri Kerminen, Kemira's President and CEO, will present theresults. Presentation material will be available on Kemira's websiteat www.kemira.com at 1:00 p.m.A conference call in English will begin at 3:00 p.m. Helsinki time.In order to participate in the call, please dial +44 (0) 20 7162 0125ten minutes before the conference begins, code 848374. Presentationmaterial will be available on Kemira's website. A recording of theconference call will be available on Kemira's website later today.Kemira Oyj will publish its results for 2009 on Tuesday, February 9,2010 at 8:30 a.m.For further information, please contact:Jyrki Mäki-Kala, CFOTel. +358 10 86 21589Päivi Antola, Senior Manager, IR & Financial CommunicationsTel. +358 10 86 21140Kemira is a global 2.8 billion euro chemicals company that is focusedon serving customers in water-intensive industries. The companyoffers water quality and quantity management that improves customers'energy, water, and raw material efficiency. Kemira's vision is to bea leading water chemistry company. Its paints and coatings business,Tikkurila, aims to be the market leader in decorative paints andselected wood and metal coatings in chosen markets.www.kemira.comThe new strategy announced in June 2008 resulted in some changes toKemira's business structure. Financial reporting reflects the newstructure from the beginning of 2009. Kemira's new reporting segmentsare Paper, Municipal & Industrial (previously "Water"), Oil & Mining,Tikkurila, and Other. The Other segment consists of specialtychemicals such as organic salts and acids and the Group expenses notcharged to the segments (some research and development costs and thecosts of the CEO Office). Kemira aims to have Tikkurila listed on theHelsinki Stock Exchange once market conditions permit.Financial Performance in July-September 2009Revenue from Kemira Group's continuing business operations fell by13% in July-September 2009 compared to the same period a year earlierdue to weaker demand in several customer industries. 7-9/2008July-September, Continuing businessEUR million 7-9/2009 operations 7-9/2008Revenue 645.8 741.9 780.0Operating profit, excludingnon-recurring items 65.3 53.4 56.5Operating profit, excludingnon-recurring items, % 10.1 7.2 7.2The impact of the titanium dioxide business transferred to a jointventure has been eliminated in the continuing business operations.Revenue in July-September 2009 amounted to EUR 645.8 million(July-September 2008: EUR 780.0 million). In the Paper segment, salesdeclined following weaker demand in customer industries. In Municipal& Industrial, demand decreased in some customer industries due tolower capacity utilization rates, and delivery volumes to municipalcustomers also fell in certain market areas. The Oil & Mining segmentexperienced a decline in demand and revenue. In Tikkurila, demanddecreased considerably as new construction, building material sales,and housing sales slowed down in all key markets. In the segmentOther, the demand and price of specialty chemicals supplied to thefood, feed, and pharmaceutical industries remained healthy.Acquisitions had an approximately EUR 18 million positive impact onrevenue. The currency exchange effect had an approximately EUR 27million negative impact on revenue, and the establishment of thejoint venture in the titanium dioxide business in 2008 decreasedrevenue by approximately EUR 38 million.Revenue, EUR million 7-9/2009 7-9/2008 1-12/2008Paper 230.2 267.7 1,003.3Municipal & Industrial 155.5 156.0 583.7Oil & Mining 56.0 74.5 275.4Tikkurila 158.1 193.7 648.1Other* 65.7 104.3 414.8Eliminations -19.7 -16.2 -92.6Total* 645.8 780.0 2,832.7*2008 includes the titanium dioxide business for the period ofJanuary-August.Operating profit for July-September 2009 was EUR 65.3 million (EUR69.8 million, including EUR 13.3 million in non-recurring items).Operating profit from continuing business, excluding non-recurringitems, increased by 22%, and mostly from lower costs. Variable costsdecreased by about EUR 36 million in July-September 2009 compared tothe same period a year earlier. Fixed costs decreased by about EUR 3million compared to the same period a year earlier.Acquisitions contributed approximately EUR 4 million to operatingprofit. The currency exchange effect had an approximately EUR 3million negative impact on operating profit. As of September 1, 2008Kemira's share of the titanium dioxide joint venture's results isbeing reported below operating profit. In the corresponding period ayear earlier, the titanium dioxide business made an operating profitof approximately EUR 3 million.Operating profit, excludingnon-recurring items, EUR million 7-9/2009 7-9/2008 1-12/2008Paper 14.8 11.7 41.5Municipal & Industrial 24.9 7.3 25.0Oil & Mining 3.5 3.5 8.4Tikkurila 26.3 30.4 59.2Other* -4.2 3.3 -1.6Eliminations - 0.3 0.1Total* 65.3 56.5 132.6*2008 includes the titanium dioxide business for the period ofJanuary-August.The share of associates' results was EUR -0.5 million (EUR -0.3million).The Group's net financial expenses in July-September totaled EUR 11.0million (EUR 20.7 million). Net financial expenses decreased from thecorresponding period a year earlier mainly due to lower interestcosts.Profit before tax in July-September amounted to EUR 53.8 million (EUR48.8 million) and net profit totaled EUR 40.6 million (EUR 35.4million). Earnings per share were EUR 0.33 (EUR 0.28).Financial Performance in January-September 2009Revenue from Kemira Group's continuing business operations fell by 7%in January-September 2009 compared to the same period a year earlierdue to weaker demand in several customer industries. 1-9/2008January-September, Continuing businessEUR million 1-9/2009 operations 1-9/2008Revenue 1,905.4 2,057.6 2,205.1Operating profit, excludingnon-recurring items 147.2 114.7 120.9Operating profit, excludingnon-recurring items, % 7.7 5.6 5.5The impact of the titanium dioxide business transferred to a jointventure has been eliminated in the continuing business operations.Revenue in January-September 2009 amounted to EUR 1,905.4 million(January-September 2008: EUR 2,205.1 million). Acquisitions had anapproximately EUR 46 million positive impact on revenue. The currencyexchange effect had an approximately EUR 49 million negative impacton revenue, and the establishment of the joint venture in thetitanium dioxide business in 2008 decreased revenue inJanuary-September by approximately EUR 148 million.Operating profit for January-September 2009 was EUR 144.8 million(EUR 142.1 million). Operating profit excluding non-recurring itemsamounted to EUR 147.2 million (EUR 120.9 million). Operating profitexcluding non-recurring items in continuing business operations wasup by 28%. Sales price increases were implemented in the second halflast year in response to the significant increase in raw materialprices. This contributed to the increase in operating profit inJanuary-September compared to the same period a year earlier andcompensated for the impact of declined sales volumes on operatingprofit. Other factors contributing to the improvement in operatingprofit included lower variable and fixed costs, and the healthydemand for specialty chemicals. Fixed costs in January-September wereapproximately EUR 28 million lower than a year earlier. Variablecosts decreased by about EUR 6 million compared to the same period ayear earlier. Acquisitions contributed approximately EUR 9 million tooperating profit. The currency exchange effect had an approximatelyEUR 7 million negative impact on operating profit. As of September 1,2008 Kemira's share of the titanium dioxide joint venture's resultsis being reported below operating profit. In the corresponding perioda year earlier, the titanium dioxide business made an operatingprofit of approximately EUR 6 million.The annual savings target of Kemira's global cost savings program ismore than EUR 85 million, with Tikkurila accounting for EUR 25million. The savings are expected to materialize in 2008-2010 and thefull annual impact is expected to be felt from 2011 onwards. Thesesavings will affect the entire Group and will be achieved bystreamlining the Group structure, organization, and operating models.The share of associates' results was EUR -5.5 million (EUR 0.0million).In January-September, profit before tax came to EUR 101.6 million(EUR 96.3 million) and net profit totaled EUR 76.2 million (EUR 70.3million). Taxes totaled EUR -25.4 million (EUR -26.0 million),representing an effective tax rate of around 25% (27%). Earnings pershare were EUR 0.61 (EUR 0.55).Financial Position and Cash FlowsIn January-September 2009, the Group reported cash flows of EUR 226.8million (EUR 77.1 million) from operating activities. Inventoriesdeclined from the year-end by 23%, or by EUR 74.9 million. Cash flowsafter investments were EUR 175.3 million (EUR 65.7 million). The cashflow effect from expansion and improvement investments was EUR -35.1million (EUR -87.2 million). Cash flow from acquisitions was EUR -3.6million (EUR -140.4 million).At the end of September, the Group's net debt stood at EUR 906.2million (December 31, 2008: EUR 1,049.1 million). Net debt declinedmainly due to the stronger cash flows. Currency exchange ratesfluctuations reduced net debt by some EUR 8 million.At the period-end, interest-bearing liabilities stood at EUR 1,119.0million. Fixed-rate loans accounted for 56% of total interest-bearingloans. The average interest rate on the Group's interest-bearingliabilities was 5.1% (5.5%). At the end of September, the duration ofthe Group's interest-bearing loan portfolio was 17 months (December31, 2008: 17 months).The unused amount of the EUR 750 million revolving credit facilitythat falls due in 2012 was EUR 424.0 million at the end of September,or 57% of the total amount. Short-term liabilities maturing in thenext 12 months amounted to EUR 204.5 million at the end of September,with commercial papers issued in the Finnish markets representing EUR146.6 million and repayments of long-term loans representing EUR 43.1million. Cash and cash equivalents totaled EUR 212.9 million onSeptember 30, 2009. Based on its current structure, it is expectedthat the Group will not encounter any significant refinancing needsin 2009-2010, since the current loan arrangements cover its financingneeds. The terms of the revolving credit facility and other majorbilateral loan agreements require that the Group's equity ratio mustbe more than 25%.At the end of September, the equity ratio stood at 37% (December 31,2008: 34%), while gearing was 87% (December 31, 2008: 107%). Gearingdeclined as a result of the decrease in interest-bearing netliabilities and the increase in equity. The net impact of currencieson shareholders' equity was approximately EUR 20 million. In April,after the Annual General Meeting, Kemira Oyj paid out EUR 30.3million in dividends.The Group's net financial expenses for January-September totaled EUR37.7 million (EUR 45.8 million). The decrease in net financialexpenses can be attributed to the lower market interest level andsmaller liabilities.Capital ExpenditureGross capital expenditure, excluding acquisitions, amounted to EUR50.5 million (EUR 116.3 million). Expansion investments representedaround 34% of capital expenditure excluding acquisitions, improvementinvestments around 35%, and maintenance investments around 31%.Full-year capital expenditure excluding acquisitions is expected tototal less than EUR 100 million.The Kemira Group's depreciation came to EUR 90.5 million (99.1million).Cash flow from the sale of assets was EUR 2.5 million (EUR 245.3million). Cash flow from acquisitions was EUR 3.6 million (EUR 140.4million). The Group's net capital expenditure totaled EUR 51.5million (EUR 11.4 million).Research and DevelopmentIn January-September, research and development expenditure totaledEUR 35.6 million (EUR 44.4 million), accounting for 2% (2%) ofrevenue.In September, Kemira opened its North American research anddevelopment center located at Technology Enterprise Park on thecampus of the Georgia Institute of Technology in Atlanta. The Atlantafacility will have global responsibility in Kemira's R&D network forpaper tissue and recycled fiber research, oil and mining research aswell as defoamer and polymer chemistry research. Operations at thecenter were launched in June 2009. Kemira's other R&D centers arelocated in Espoo, Finland; Leverkusen, Germany and Shanghai, China.A fifth center will be established in São Paulo, Brazil during 2010.Human ResourcesThe number of Group employees at the end of September was 8,561(9,392).Kemira conducted a personnel survey in May-June. The objective of thesurvey was to assess personnel satisfaction and commitment and toidentify the organization's strengths and development areas. Theresponse rate of 87% is very high, which is a positive sign of thepersonnel's willingness to express their views on Kemira as aworkplace. The survey showed that people found their work challengingand interesting, and were satisfied with their work. When asked toname key organizational strengths, employees mentioned supervisorywork and leadership. Supervisors were found to be easy to approach,and trust and recognition for achievements were also consideredstrengths. According to the survey, further development was needed incommunicating Kemira's strategy, objectives and structure.Kemira participates in Baltic Sea Action Group's Commitment to ActKemira participates in the pro-Baltic Sea work carried out by theBaltic Sea Action Group and announced its commitment to act inAugust. The Commitment to Act was initiated by the Baltic Sea ActionGroup, a neutral Finland-based organization founded in March 2008 torescue the Baltic Sea. Kemira's business plays a direct role indecreasing the wastewater load in the Baltic Sea, as a significantshare of the communities and cities within the Baltic Sea watershedclean their waste water using chemicals supplied by Kemira. In itsCommitment to Act, Kemira agrees to lend its expertise and researchefforts to returning sludge-borne valuable nutrients, nitrogen andphosphorus, safely into the natural cycle without causingeutrophication in waterways.Near-Term Risks and Uncertainty FactorsThe key risks and uncertainty factors affecting Kemira's business arerelated to general economic developments and their impact on thedemand for Kemira's products.Sharp fluctuations in global electricity and oil prices will affectraw material prices and the cost of logistics and, therefore, bereflected in Kemira's performance.If the industrial by-products Kemira uses as raw materials were to bein short supply or even run out entirely, this could have a negativeeffect on Kemira's results, particularly in the Municipal &Industrial segment. Similarly, capacity reductions in the rawmaterial supplier chain may affect Kemira's production costs. As aresult of the general economic development, some of our partners suchas companies in the logistics business may experience difficulties,which may affect Kemira's operations temporarily.With progressive implementation of the REACH legislation, the numberof raw materials and their suppliers may be reduced, which couldraise Kemira's raw material costs. Also, registration of Kemira's ownproducts under REACH may be more expensive than anticipated,especially if costs cannot be shared with other companies.Furthermore, currency exchange rate volatility in Kemira's keycurrencies may affect the Group's figures.A detailed account of Kemira's risk management principles andpractices is available at the company's website, www.kemira.com. Anaccount of financial risks was published in the Notes to the Accountssection of the Financial Statements for 2008. Kemira's environmentalreport discusses environmental and accident risks.SegmentsPaperWe offer chemical products and integrated systems that help customersin the water-intensive pulp and paper industry to improve theirprofitability as well as their water, raw material and energyefficiency. Our solutions support sustainable development.EUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 1-12/2008Revenue 230.2 267.7 676.8 756.5 1,003.3EBITDA 26.9 23.0 67.6 66.8 69.4EBITDA, % 11.7 8.6 10.0 8.8 6.9Operating profit,excluding 14.8 11.7 30.3 31.7 41.5non-recurring itemsOperating profit 14.8 10.9 30.3 30.9 -2.6Operating profit,excluding 6.4 4.4 4.5 4.2 4.1non-recurring items, %Operating profit, % 6.4 4.1 4.5 4.1 -0.3Capital employed* 806.5 806.3 806.5 806.3 826.7ROCE %* -0.4 3.5 -0.4 3.5 -0.3Capital expenditure,excluding acquisitions 6.0 9.9 24.5 41.1 51.7Cash flow afterinvestments, excludinginterest and taxes 25.3 -8.3 56.8 27.9 15.5* 12-month rolling averageThe Paper segment's revenue in July-September 2009 shrank by 14% toEUR 230.2 million (EUR 267.7 million) as demand in customerindustries has decreased markedly. The currency exchange effect had aEUR 2 million negative impact on revenue.The consumption of paper used in magazines and newspapers and thenumber of printed merchandizing items have fallen, particularly inthe traditional markets in Europe and North America. Managementestimates that demand has decreased by 10-25%, depending on the papergrade. To adapt production to weaker demand, the Paper segment'scustomers in the paper industry have cut back and shut down capacity,and cleared stocks. The demand for packaging boards has also becomemore sluggish, although Asia and Eastern Europe are showing signs ofrecovery in demand.Operating profit excluding non-recurring items for July-September wasEUR 14.8 million (EUR 11.7 million). Operating profit as a percentageof revenue rose to 6.4% from 4.4% last year (excluding non-recurringitems). Lower fixed and variable costs compensated for the decline insales volumes. Variable costs decreased by about EUR 12 million inJuly-September 2009 compared to the same period a year earlier.At the beginning of the year, Kemira and the Chinese companyTiancheng Ltd. set up a joint venture, Kemira-Tiancheng Chemicals(Yanzhou) Co., Ltd, to produce AKD wax, and adhesives derived fromthis wax, for the paper and board industry. The company's operationshave started out as planned, and the company's home market in Chinashows a healthy demand for the products.Kemira has been taking measures over a period of several years toadjust its paper and pulp chemicals business to the increasinglychallenging market. In addition to temporary production shut-downs,AKD wax production in Vaasa, Finland, was shut down in March 2009.Over the last few years, six North American production facilitieshave been closed and this year Kemira will shut down its polymerproduction in Columbus, USA.In January-September the Paper segment's revenue fell by 11% to EUR676.8 million (EUR 756.5 million). The currency exchange effect had aEUR 4 million positive impact on revenue. Operating profit excludingnon-recurring items was EUR 30.3 million (EUR 31.7 million). Variablecosts in January-September were approximately EUR 5 million higherthan in the same period in 2008 while fixed costs decreased.Municipal & IndustrialWe offer water treatment chemicals for municipalities and industrialcustomers.Our strengths are high-level process know-how, a comprehensive rangeof water treatment chemicals, and reliable customer deliveries.EUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 1-12/2008Revenue 155.5 156.0 466.9 436.7 583.7EBITDA 32.6 13.6 74.1 36.3 41.0EBITDA, % 21.0 8.7 15.9 8.3 7.0Operating profit,excluding 24.9 7.3 53.5 18.1 25.0non-recurring itemsOperating profit 24.9 7.3 53.5 18.6 5.3Operating profit,excluding 16.0 4.7 11.5 4.1 4.3non-recurring items, %Operating profit, % 16.0 4.7 11.5 4.3 0.9Capital employed* 357.3 321.2 357.3 321.2 342.7ROCE %* 11.2 7.7 11.2 7.7 1.6Capital expenditure,excluding acquisitions 3.7 3.2 9.2 23.0 29.7Cash flow afterinvestments, excludinginterest and taxes 28.2 -9.4 84.1 -10.5 -13.8* 12-month rolling averageThe Municipal & Industrial segment's (formerly Water segment) revenuein July-September 2009 totaled EUR 155.5 million (EUR 156.0million). The currency exchange effect had a EUR 2 million negativeimpact on revenue. Acquisitions had an approximately EUR 7 millionpositive impact on revenue.Healthy demand continued in the municipal water treatment businessdespite a decrease in delivery volumes to municipal customers incertain market areas. In the industrial water treatment business,demand has decreased in some customer industries due to lowercapacity utilization rates, but in other industries, such as the foodindustry and power production, demand for water treatment chemicalshas been stable. Total delivery volumes fell slightly inJuly-September 2009 compared to the same period a year earlier.Operating profit excluding non-recurring items was EUR 24.9 million(EUR 7.3 million). Operating profit as a percentage of revenue rosefrom 4.7% last year to 16.0%. Variable costs decreased by about EUR18 million in July-September compared to the same period a yearearlier. Fixed cost savings also boosted the operating profit.Acquisitions had an approximately EUR 2 million positive impact onoperating profit.In September, Kemira and Akzo Nobel agreed that Kemira will take overAkzo Nobel's water treatment iron coagulant business in Scandinavia(Sweden, Norway and Denmark). The business deal did not involve anytransfer of personnel or production facilities.In January-September the Municipal & Industrial segment's revenuerose by 7% to EUR 466.9 million (EUR 436.7 million). Acquisitions hadan approximately EUR 20 million positive impact on revenue. Deliveryvolumes were lower than in the same period a year earlier but averageprices were higher. Operating profit excluding non-recurring itemswas EUR 53.5 million (EUR 18.1 million). Factors contributing to theimprovement in operating profit included higher sales prices andlower variable and fixed costs. Acquisitions contributedapproximately EUR 5 million to operating profit.The business segment was renamed Municipal & Industrial in Septemberto replace the previous name "Water". The new name describes thesegment's customer base, which ranges from small municipalities tobig cities and various industries.A reclassification will be made to revenue in the final quarter basedon new customer assignments that will lower the Municipal &Industrial segment's revenue for 2009 by less than EUR 10 million,and correspondingly will raise the Oil & Mining segment's revenue byless than EUR 10 million.Oil & MiningWe offer a large selection of innovative chemical extraction andprocess solutions for the oil and mining industries, where waterplays a central role. Utilizing our expertise, we enable ourcustomers to improve efficiency and productivity.EUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 1-12/2008Revenue 56.0 74.5 165.6 208.8 275.4EBITDA 5.7 5.9 15.6 17.4 15.3EBITDA, % 10.2 7.9 9.4 8.3 5.6Operating profit,excluding 3.5 3.5 8.7 7.8 8.4non-recurring itemsOperating profit 3.5 3.4 8.7 9.6 1.9Operating profit,excluding 6.3 4.7 5.3 3.7 3.1non-recurring items, %Operating profit, % 6.3 4.6 5.3 4.6 0.7Capital employed* 154.7 156.3 154.7 156.3 160.4ROCE %* 0.6 -1.3 0.6 -1.3 1.2Capital expenditure,excluding acquisitions 1.2 1.7 2.7 7.5 8.8Cash flow afterinvestments, excludinginterest and taxes 4.3 5.1 13.2 16.8 14.3* 12-month rolling averageThe Oil & Mining segment's revenue in July-September dropped by 25%to EUR 56.0 million (EUR 74.5 million). Revenue fell as a result ofweaker demand, particularly in the mining industry. The currencyexchange effect had a EUR 2 million positive impact on revenue.In the oil and gas industry, demand remained flat as a consequence ofcuts in exploration, drilling, and production services. Demandrecovery is expected with oil and gas as prices increase. In mining,some signs of improvement were seen in metals, where iron-oreproduction has increased significantly to feed steel mills.Improvement in aluminum consumption is also expected.Operating profit excluding non-recurring items for July-September wasEUR 3.5 million (EUR 3.5 million). Operating profit as a percentageof revenue rose to 6.3% from 4.7% last year (excluding non-recurringitems). Lower sales volumes were compensated by lower variable costswhich decreased by about EUR 7 million in July-September compared tothe same period a year earlier.In January-September, revenue fell by 21% to EUR 165.6 million (EUR208.8 million) due to weak demand. The currency exchange effect had aEUR 10 million positive impact on revenue. Operating profit excludingnon-recurring items was EUR 8.7 million (EUR 7.8 million). Variablecosts in January-September were approximately EUR 12 million lowerthan in the same period in 2008.Oil & Mining segment is based on Kemira's water competence and watertreatment product range. Its strategy is to focus on extraction andprocess solution where water quality and quantity management plays acentral role for the customers. Oil & Mining implements this strategyby leveraging Kemira's global presence, production footprint, andresearch network.A reclassification will be made to revenue in the final quarter basedon new customer assignments that will raise the Oil & Miningsegment's revenue for 2009 by less than EUR 10 million, andcorrespondingly will lower the Municipal & Industrial segment'srevenue by less than EUR 10 million.TikkurilaOur product range consists of decorative paints and coatings for thewood and metal industries. We provide consumers, professionalpainters, and industrial customers with branded products and expertservices in approximately 40 countries.EUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 1-12/2008Revenue 158.1 193.7 431.7 544.6 648.1EBITDA 31.2 35.2 66.5 86.1 78.2EBITDA, % 19.7 18.2 15.4 15.8 12.1Operating profit,excluding 26.3 30.4 54.8 71.8 59.2non-recurring itemsOperating profit 26.3 30.4 52.4 71.8 59.2Operating profit,excluding 16.6 15.7 12.7 13.2 9.1non-recurring items, %Operating profit, % 16.6 15.7 12.1 13.2 9.1Capital employed* 306.5 324.2 306.5 324.2 323.6ROCE %* 13.0 20.4 13.0 20.4 18.3Capital expenditure,excluding acquisitions 2.7 3.9 11.0 17.9 32.1Cash flow afterinvestments, excludinginterest and taxes 64.8 59.0 52.5 56.0 52.2* 12-month rolling averageTikkurila's revenue in July-September decreased by 18% and totaledEUR 158.1 million (EUR 193.7 million). The decrease is associatedwith the general economic recession, which caused a slowdown in bothnew construction and the sales of building materials and resulted inmore sluggish housing sales in all key markets. The currency exchangeeffect had a EUR 24 million negative impact on revenue. Acquisitionshad an approximately EUR 3 million positive impact on revenue.Operating profit excluding non-recurring items for July-September wasEUR 26.3 million (EUR 30.4 million). Operating profit decreased assales volumes declined, even though the average price of soldproducts was higher than in the comparison period. Variable costsincreased by about EUR 5 million compared to the same period a yearearlier while fixed costs decreased. The currency exchange effect hada EUR 3 million negative impact on operating profit.The operations of the logistics and service center in Mytishchi nearMoscow, which came on stream in February, have started out well. Thecenter now houses all of Tikkurila's decorative paints and industrialpaints operations in the Moscow region and features facilities forcustomer training. This center will further improve Tikkurila'scustomer services in Moscow and the surrounding area.In August, Tikkurila announced its intentions to acquire the 50%stake of the Slovenian JUB coatings company in the trading companyTikkurila JUB Romania SRL. The ownership was transferred on September1, 2009, with 100% ownership now by Tikkurila. The name will changeto Tikkurila SRL. Tikkurila JUB Romania SRL was established in May2008 for marketing, selling and distributing Tikkurila's and JUB'sdecorative paints in Romania. In addition to decorative paints, theservice concept of Tikkurila SRL will also include Tikkurila'sindustrial coatings. With an office and a warehouse in Bucharest, thecompany employs around 10 people.Due to lower sales volumes, Tikkurila's revenue in January-Septemberfell by 21% to EUR 431.7 million (EUR 544.6 million). The currencyexchange effect had a EUR 65 million negative impact on revenue.Acquisitions had an approximately EUR 7 million positive impact onrevenue. Operating profit excluding non-recurring items was EUR 54.8million (EUR 71.8 million). Variable costs in January-September wereapproximately EUR 18 million higher than in the same period in 2008.The currency exchange effect had a EUR 6 million negative impact onoperating profit.The key elements of Tikkurila's strategy are customer focus,profitable growth, geographic focus, strong brands, and one unifiedTikkurila. To improve customer services and efficiency, Tikkurilawill change its organization as of January 1, 2010 to reflect thegeographic division. The four new strategic business units are East,Finland, Scandinavia, and Central Eastern Europe.Kemira Oyj's Shares and ShareholdersIn January-September, the Kemira Oyj share price registered a high ofEUR 11.90 and a low of EUR 4.26, the average price being EUR 7.23. OnSeptember 30, the company's market capitalization, excluding treasuryshares, totaled EUR 1,325.8 million.On September 30, the company's share capital totaled EUR 221.8million and the number of registered shares was 125,045,000. Kemiraholds 3,854,771 treasury shares, accounting for 3.1% of outstandingcompany shares and voting rights.Changes in Group managementIn August, Kemira Oyj's CFO Jyrki Mäki-Kala was appointed new DeputyCEO as of September 1, 2009 following the retirement of the previousDeputy CEO Esa Tirkkonen. Esa Tirkkonen was the Deputy CEO since 2000and employed by the company since 1974.Damage Claim for Violation of Competition LawsOn August 19, 2009, Kemira Oyj received a summons stating that CartelDamage Claims Hydrogen Peroxide SA (CDC) had filed an action againstsix hydrogen peroxide manufacturers, including Kemira, for violationsof competition law applicable to the hydrogen peroxide business.Kemira Oyj reported on the damage claim in the interim report forJanuary-June 2009.Kemira Pension Fund's pension liability will be transferredKemira Oyj's statutory employees' pension insurance (TyEL) will betransferred from Kemira Pension Fund to Varma Mutual PensionInsurance Company on December 31, 2009. The transfer will not affectthe level of employees' pension security or its coverage. Due to thetransfer, Kemira will record non-recurring expenses of EUR 11 millionin the result to October-December. Kemira Oyj also has employees'pension insurance in the Ilmarinen Mutual Pension Insurance Company.Kemira to undertake a rights offeringThe Board of Directors of Kemira has decided to undertake a shareoffering to raise gross proceeds of approximately EUR 200 millionthrough an issue of new shares with pre-emptive rights for existingshareholders. The four largest shareholders of the company supportthe rights offering. The proceeds of the rights offering will be usedto support Kemira's growth strategy and vision to become a leadingwater chemistry company, to enable the separation and listing ofTikkurila and to strengthen Kemira's balance sheet. The rightsoffering is subject to shareholder approval at an extraordinarygeneral meeting of shareholders scheduled to be held on November 23,2009.Listing of TikkurilaKemira aims to have the shares of Tikkurila listed on the HelsinkiStock Exchange once market conditions permit. Kemira's Board ofDirectors has approved a planned structure for the listing. Accordingto the planned structure Kemira would distribute a substantialmajority of the shares of Tikkurila as dividend to Kemira'sshareholders with Kemira retaining a minority holding in Tikkurila.Kemira does not intend to raise cash proceeds for Kemira inconnection with Tikkurila's separation.OutlookKemira's progress in January-September 2009 was very good. However,the market situation is expected to remain challenging. Kemira willcontinue its efficiency improvement measures launched earlier.The annual savings target of the announced global cost savingsprogram is more than EUR 85 million, with Tikkurila accounting forEUR 25 million. The savings are expected to materialize in 2008-2010and the full annual impact is expected to be felt from 2011 onwards.Kemira's revenue for October-December 2009 is expected to remainbehind the previous year due to reduced demand in customerindustries. Operating profit excluding non-recurring items isexpected to grow from the EUR 11.7 million recorded a year earlier.Helsinki, October 28, 2009Kemira OyjBoard of DirectorsAll forward-looking statements in this review are based on themanagement's current expectations and beliefs about future events,and actual results may differ materially from the expectations andbeliefs contained in the forward-looking statements.KEMIRA GROUPThe figures are unaudited.All figures in this financial report have been rounded andconsequently the sum of individual figures can deviate from thepresented sum figure.This Interim Consolidated Financial Statement has been prepared incompliance with IAS 34.The accounting policies adopted are consistent with those of theGroup's annual financial statement, added with the following changes.Changes to the accounting policies as of January 1,2009:- IFRS 8 Operating Segments. The adoption of the standard has changedthe way in which segment information is presented. The segmentinformation in the financial statements changed at the beginning of2009 owing to the reorganization of the Group. The comparativefigures have been published with separate release March 2009.- IAS 23 Borrowing costs. The adoption of the amended standard willmean a change to the consolidated financial statements' accountingpolicies but will not have any material effect on the futurefinancial statements.- IAS 1 Presentation of Financial Statements. The amendment of thestandard has changed the presentation of the income statement and thestatement of changes in equity.INCOME STATEMENT 7-9/2009 7-9/2008 1-9/2009 1-9/2008 2008EUR millionRevenue 645.8 780.0 1,905.4 2,205.1 2,832.7Other operatingincome 3.7 18.6 11.2 39.9 51.5Expenses -553.5 -696.7 -1,681.3 -2,003.8 -2,640.8Depreciation andimpairments -30.7 -32.1 -90.5 -99.1 -169.4Operating profit 65.3 69.8 144.8 142.1 74.0Financial income andexpenses, net -11.0 -20.7 -37.7 -45.8 -69.5Share of profit orloss of associates -0.5 -0.3 -5.5 - -2.7Profit before tax 53.8 48.8 101.6 96.3 1.8Income tax -13.2 -13.4 -25.4 -26.0 -Net profit for theperiod 40.6 35.4 76.2 70.3 1.8Attributable to:Equity holders of theparent 39.3 34.4 73.4 66.8 -1.8Minority interest 1.3 1.0 2.8 3.5 3.6Net profit for theperiod 40.6 35.4 76.2 70.3 1.8Earnings per share,basic and diluted, EUR 0.33 0.28 0.61 0.55 -0.02STATEMENT OFCOMPREHENSIVE INCOMEEUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 2008Net profit for theperiod 40.6 35.4 76.2 70.3 1.8Other comprehensiveincome, net of tax: Available-for-sale - change in fairvalue - - - 59.2 35.3 Exchangedifferences 19.9 -5.7 22.5 -12.9 -74.2 Hedge of netinvestment in foreign entities -1.7 - -2.5 2.3 9.1 Cash flow hedging:amount entered in shareholders'equity -3.1 -8.0 2.0 -0.7 -22.0 Other changes -0.2 - -0.2 0.1 2.1Other comprehensiveincome, net of tax 14.9 -13.7 21.8 48.0 -49.7Total comprehensiveincome 55.5 21.7 98.0 118.3 -47.9Attributable to:Equity holders of theparent 54.1 21.2 94.9 114.9 -49.4Minority interest 1.4 0.5 3.1 3.4 1.5Total comprehensiveincome 55.5 21.7 98.0 118.3 -47.9BALANCE SHEETEUR millionASSETS 30.9.2009 31.12.2008Non-current assetsGoodwill 659.6 655.1Other intangibleassets 104.8 111.6Property, plant andequipment 742.6 765.7Investments Holdings inassociates 130.0 135.6 Available-for-salefinancial assets 161.3 159.8 Deferred tax assets 13.0 12.7 Other investments 12.9 11.5Total investments 317.2 319.6Defined benefitpension receivables 54.3 54.0Total non-currentassets 1,878.5 1,906.0Current assetsInventories 244.4 319.3Receivables Interest-bearingreceivables 4.2 7.6 Interest-freereceivables 458.5 507.4Total receivables 462.7 515.0Money marketinvestments - cash equivalents 166.1 87.1Cash and cashequivalents 46.8 32.3Total current assets 920.0 953.7Total assets 2,798.5 2,859.7EQUITY AND 30.9.2009 31.12.2008LIABILITIESEquity attributableto equity holders of theparent 1,028.0 962.8Minority interest 18.3 13.2Total equity 1,046.3 976.0Non-currentliabilitiesInterest-bearingnon-currentliabilities 914.3 609.2Deferred taxliabilities 87.7 89.9Pension liabilities 70.1 67.5Provisions 57.3 61.8Total non-currentliabilities 1,129.4 828.4Current liabilitiesInterest-bearingcurrent liabilities 204.7 559.3Interest-free currentliabilities 411.3 485.2Provisions 6.8 10.8Total currentliabilities 622.8 1,055.3Total liabilities 1,752.2 1,883.7Total equity andliabilities 2,798.5 2,859.7CONSOLIDATED CASHFLOW STATEMENTEUR million 7-9/2009 7-9/2008 1-9/2009 1-9/2008 2008Cash flows fromoperating activitiesAdjusted operatingprofit 92.1 83.1 227.3 207.4 217.0Interests and otherfinancing items -5.3 -14.8 -26.1 -47.6 -75.2Dividend income - 0.1 0.2 0.1 1.0Income taxes paid -7.1 0.4 -22.8 -18.2 -23.9Total funds fromoperations 79.7 68.8 178.6 141.7 118.9Change in net workingcapital 59.4 -6.3 48.2 -64.6 -28.7Total cash flows fromoperating activities 139.1 62.5 226.8 77.1 90.2Cash flows frominvesting activitiesCapital expenditurefor acquisitions 0.1 -136.5 -3.6 -140.4 -180.8Other capitalexpenditure -14.4 -28.8 -50.5 -116.3 -161.0Proceeds from sale ofassets 1.0 234.2 2.6 245.3 254.3Net cash used ininvesting activities -13.3 68.9 -51.5 -11.4 -87.5Cash flow afterinvesting activities 125.8 131.4 175.3 65.7 2.7Cash flows fromfinancing activitiesChange in non-currentloans (increase +,decrease -) -120.2 68.0 -81.8 203.1 426.6Change in non-currentloan receivables (decrease +,increase -) -0.9 -6.5 -1.7 -8.6 -7.1Short-term financing,net (increase +,decrease -) 47.7 -164.9 36.8 -174.4 -282.1Dividends paid -0.5 -0.3 -33.5 -64.2 -64.2Other -0.4 -20.0 -1.6 -12.3 -9.1Net cash used infinancing activities -74.3 -123.7 -81.8 -56.4 64.1Net change in cashand cash equivalents 51.5 7.7 93.5 9.3 66.8Cash and cashequivalents at end ofperiod 212.9 61.9 212.9 61.9 119.4Cash and cashequivalents at beginning of period 161.4 54.2 119.4 52.6 52.6Net change in cashand cash equivalents 51.5 7.7 93.5 9.3 66.8STATEMENT OF CHANGES INEQUITYEUR million Equity attributable to equity holders of the parent Capital paid-in Fair in value Share excess and other of capital par reserves valueShareholders'equity atJanuary 1, 2008 221.8 257.9 68.2Net profit forthe period - - -Othercomprehensiveincome, net oftax - - 58.3Totalcomprehensiveincome - - 58.3Dividends paid - - -Share-basedcompensations - - -Transfer betweenrestricted and non-restrictedequity - - 0.9Shareholders'equity atSeptember 30,2008 221.8 257.9 127.4Shareholders'equity atJanuary 1, 2009 221.8 257.9 81.4Net profit forthe period - - -Othercomprehensiveincome, net oftax - - 2.1Totalcomprehensiveincome - - 2.1Dividends paid - - -Share-basedcompensations - - -Changes due tobusinesscombinations - - -Transfer betweenrestricted and non-restrictedequity - - 0.2Shareholders'equity atSeptember 30,2009 221.8 257.9 83.7 Equity attributable to equity holders of the parent Exchange Treasury Retained differences shares earningsShareholders'equity atJanuary 1, 2008 -41.1 -25.9 591.1Net profit forthe period - - 66.8Othercomprehensiveincome, net oftax -10.7 - 0.5Totalcomprehensiveincome -10.7 - 67.3Dividends paid - - -60.6Share-basedcompensations - - 0.6Transfer betweenrestricted and non-restrictedequity - - -0.9Shareholders'equity atSeptember 30,2008 -51.8 -25.9 597.5Shareholders'equity atJanuary 1, 2009 -104.6 -25.9 532.2Net profit forthe period - - 73.4Othercomprehensiveincome, net oftax 19.5 - -0.1Totalcomprehensiveincome 19.5 - 73.3Dividends paid - - -30.3Share-basedcompensations - - 0.6Changes due tobusinesscombinations - - -Transfer betweenrestricted and non-restrictedequity - - -0.2Shareholders'equity atSeptember 30,2009 -85.1 -25.9 575.6 Minority interests TotalShareholders'equity at 15.3 1,087.3January 1, 2008Net profit for 3.5 70.3the periodOthercomprehensive -0.1 48.0income, net oftaxTotalcomprehensive 3.4 118.3incomeDividends paid -3.6 -64.2Share-based - 0.6compensationsTransfer betweenrestricted and non-restricted - 0.0equityShareholders'equity at 15.1 1,142.0September 30,2008Shareholders'equity at 13.2 976.0January 1, 2009Net profit for 2.8 76.2the periodOthercomprehensive 0.3 21.8income, net oftaxTotalcomprehensive 3.1 98.0incomeDividends paid -3.2 -33.5Share-based - 0.6compensationsChanges due tobusiness 5.2 5.2combinationsTransfer betweenrestricted and non-restricted - 0.0equityShareholders'equity at 18.3 1,046.3September 30,2009Kemira had in its possession 3,854,465 of its treasuryshares at December 31, 2008. 306 shares granted accordingshare-based incentive plan were returned 2009. Kemira hadin its possession 3,854,771 of its treasury shares atSeptember 30, 2009. Their average acquisition share pricewas EUR 6.73 and the treasury shares represented 3.1% ofthe share capital and of the aggregate number of votesconferred by all the shares. The equivalent book value ofthe treasury shares is EUR 6.8 million.KEY FIGURES 7-9/2009 7-9/2008 1-9/2009 1-9/2008 2008Earnings pershare, basic anddiluted, EUR 0.33 0.28 0.61 0.55 -0.02Cash flow fromoperationsper share, EUR 1.15 0.52 1.87 0.64 0.74Capitalexpenditure, EUR 14.3 165.3 54.1 256.7 341.8millionCapitalexpenditure / 2.2 21.2 2.8 11.6 12.1revenue, %Average numberof shares(1000),basic * 121,190 121,191 121,190 121,191 121,191Average numberof shares(1000),diluted * 121,190 121,191 121,190 121,191 121,191Number of sharesat endof period 121,190 121,191 121,190 121,191 121,191(1000), basic *Number of sharesat end ofperiod (1000), 121,190 121,191 121,190 121,191 121,191diluted *Equity pershare,attributable toequity holdersof the parent, 8.48 9.30 7.94EUREquity ratio, % 37.4 39.7 34.1Gearing, % 86.6 86.7 107.5Interest-bearingnet 906.2 990.5 1,049.1liabilities,EUR millionPersonnel 8,954 10,145 9,954(average)* Number of sharesoutstanding, excluding the number ofshares boughtback.REVENUE BY 7-9/2009 7-9/2008 1-9/2009 1-9/2008 2008BUSINESS AREAEUR millionPaper external 229.9 263.0 676.0 741.2 987.6Paper 0.3 4.7 0.8 15.3 15.7Intra-GroupMunicipal &Industrial 155.6 155.9 466.7 435.4 582.2externalMunicipal &Industrial -0.1 0.1 0.2 1.3 1.5Intra-GroupOil & Mining 55.9 73.6 165.2 207.3 273.3externalOil & Mining 0.1 0.9 0.4 1.5 2.1Intra-GroupTikkurila 158.1 193.7 431.7 544.6 648.1externalTikkurila - - - - -Intra-GroupOther external 46.3 93.9 165.8 276.7 341.5Other 19.4 10.4 56.8 56.2 73.3Intra-GroupEliminations -19.7 -16.2 -58.2 -74.4 -92.6Total 645.8 780.0 1,905.4 2,205.1 2,832.7OPERATING PROFIT 7-9/2009 7-9/2008 1-9/2009 1-9/2008 2008BY BUSINESS AREAEUR millionPaper 14.8 10.9 30.3 30.9 -2.6Municipal & 24.9 7.3 53.5 18.6 5.3IndustrialOil & Mining 3.5 3.4 8.7 9.6 1.9Tikkurila 26.3 30.4 52.4 71.8 59.2Other -4.2 17.5 -0.1 11.1 10.1Eliminations - 0.3 - 0.1 0.1Total 65.3 69.8 144.8 142.1 74.0CHANGES IN PROPERTY, PLANTAND EQUIPMENT 1-9/2009 1-9/2008 2008EUR millionCarrying amountat beginning of 765.7 984.3 984.3yearAcquisitions of 0.1 - 6.3subsidiariesIncreases 46.9 97.0 127.9Decreases -2.2 -5.3 -9.4Disposal of - -168.4 -168.1subsidiariesDepreciation and -73.8 -83.6 -144.5impairmentsExchange ratedifferences and other changes 5.9 5.5 -30.8Net carryingamount at end of 742.6 829.5 765.7periodCHANGES ININTANGIBLEASSETS 1-9/2009 1-9/2008 2008EUR millionCarrying amountat beginning of 766.7 738.9 738.9yearAcquisitions of 2.4 3.1 36.3subsidiariesIncreases 8.6 19.4 24.3Decreases - -0.1 -Disposal of - -8.1 -8.1subsidiariesDepreciation and -16.7 -15.5 -24.9impairmentsExchange ratedifferences and other changes 3.4 5.8 0.2Net carryingamount at end of 764.4 743.5 766.7periodCONTINGENT 30.9.2009 31.12.2008LIABILITIESEUR millionMortgages 41.5 43.3Assets pledged On behalf of 5.6 5.2own commitmentsGuarantees On behalf of 11.0 14.1own commitments On behalf of 1.1 1.2associates On behalf of 9.6 5.5othersOperatingleasingliabilities Maturity 22.3 20.9within one year Maturity after 122.8 115.0one yearOtherobligations On behalf of 1.3 2.6own commitments On behalf of 1.8 1.9associatesMajor off-balance sheetinvestment commitmentsThere were no major contractual commitments for theacquisition of property, plant and equipment on September30, 2009.LitigationOn August 19, 2009, Kemira Oyj received asummons stating that Cartel Damage ClaimsHydrogen Peroxide SA (CDC) had filed an actionagainst six hydrogen peroxide manufacturers,including Kemira, for violations of competitionlaw applicable to the hydrogen peroxidebusiness. Due to its extensive internationaloperations the Group, in addition to the CDCclaim, is involved in a number of other legalproceedings incidental to these operations andit does not expect the outcome of these othercurrently pending legal proceedings to havematerially adverse effect upon its consolidatedresults or financial position.RELATED PARTYTransactions with related parties have notchanged materially after annual closing 2008.DERIVATIVEINSTRUMENTSEUR million 30.9.2009 31.12.2008 Nominal Fair Nominal Fair value value value valueCurrencyinstrumentsForwardcontracts 394.9 0.9 427.6 11.7of which hedgesofnet investmentin a foreignoperation - - - -Currency options Bought - - - - Sold - - - -Currency swaps 29.3 -3.8 27.6 -5.6Interest rateinstrumentsInterest rateswaps 350.9 -9.2 338.8 -6.9of which cashflow hedge 304.0 -7.1 304.4 -6.5Interest rateoptions Bought 110.0 - 110.0 -0.1 Sold - - - -Bond futures 10.0 -0.1 10.0 - of which open 10.0 -0.1 10.0 -Otherinstruments GWh GWhElectricityforwardcontracts,bought 1,204.1 -8.7 1,431.5 -10.7 of which cashflow hedge 1,134.0 -8.3 1,378.9 -9.7Electricityforwardcontracts, sold 52.6 0.4 52.6 1.2 of which cashflow hedge - - - - K tons K tonsNatural gashedging 15.6 -1.0 15.6 -2.0 of which cashflow hedge 15.6 -1.0 15.6 -2.0Salt derivatives 160.0 0.3 212.8 2.0The fair values of the instrumentswhich are publicly traded are based onmarket valuation on the date ofreporting. Other instruments have beenvaluated based on net present valuesof future cash flows. Valuation modelshave been used to estimate the fairvalues of options.Nominal values of the financialinstruments do not necessarilycorrespond to the actual cash flowsbetween the counterparties and do nottherefore give a fair view of the riskposition of the Group.BUSINESSCOMBINATIONTikkurila acquired 50% share ofTikkurila JUB Romania SRL on September2009. After the acquisition thecompany is wholly owned by Tikkurila.The business combination isindividually immaterial.QUARTERLYINFORMATION 2008 2008 2008 2008EUR million Q4 Q3 Q2 Q1RevenuePaper external 246.4 263.0 234.7 243.5PaperIntra-Group 0.4 4.7 6.4 4.2Municipal &Industrialexternal 146.8 155.9 143.7 135.8Municipal &IndustrialIntra-Group 0.2 0.1 0.7 0.5Oil & Miningexternal 66.0 73.6 66.7 67.0Oil & MiningIntra-Group 0.6 0.9 0.1 0.5Tikkurilaexternal 103.5 193.7 205.7 145.2TikkurilaIntra-Group - - - -Other external 64.8 93.9 90.7 92.1OtherIntra-Group 17.1 10.4 21.1 24.7Eliminations -18.2 -16.2 -28.3 -29.9Total 627.6 780.0 741.5 683.6Operating profitPaper -33.5 10.9 7.6 12.4Municipal &Industrial -13.3 7.3 4.7 6.6Oil & Mining -7.7 3.4 2.4 3.8Tikkurila -12.6 30.4 29.7 11.7Other -1.0 17.5 -4.9 -1.5Eliminations - 0.3 -0.2 -Total -68.1 69.8 39.3
Datum: 28.10.2009 - 11:01 Uhr
Sprache: Deutsch
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