STOCK EXCHANGE RELEASE 4 Feb 2015
Pöyry PLC: Pöyry PLC's notice concerning annual accounts for 2014
PÖYRY PLC Financial Statement Release 4 February 2015 at 8:30 a.m. EET
NET SALES AND OPERATING PROFIT DECLINED
|Order stock at end of period, EUR million||472.5||499.7||-5.5||472.5||499.7||-5.5|
|Net sales total, EUR million||136.4||160.6||-15.1||571.2||650.8||-12.2|
| Operating profit,
|Operating margin, %||-8.9||5.2||-4.0||2.1|
| Profit before taxes,
|Earnings per share, basic, EUR||-0.21||0.04||n.a.||-0.40||0.06||n.a.|
|Earnings per share, diluted, EUR||-0.21||0.04||n.a.||-0.40||0.06||n.a.|
|Return on investment, % (R12M)||-9.9||5.8|
|Average number of personnel during period, calculated as full time equivalents (FTE)||5,433||6,139||-11.5|
All figures and sums have been rounded off from the exact figures, which may lead to minor discrepancies upon addition or subtraction.
JANUARY - DECEMBER 2014 HIGHLIGHTS
Figures in brackets, unless otherwise stated, refer to the same period of the previous year.
- The Group's comparable order stock improved slightly from EUR 461.9 million at the end of 2013 to EUR 472.5 million on 31 December 2014, excluding the divestment in Finland, which was executed in June 2014. On 31 December 2013, reported order stock was EUR 499.7 million. Order stock increased in the Industry Business Group and remained stable in other Business Lines.
- Comparable net sales were EUR 552.4 (601.8) million. Reported net sales declined to EUR 571.2 (650.8) million, which was mainly attributable to developments in the Regional Operations.
- Consolidated operating profit decreased to EUR -23.1 (13.9) million. The figure includes a write-off of the receivables from Venezuela amounting to EUR -14 million and a gain of EUR +19 million from the divestment in Finland. Both items were recognised in June 2014. Comparable figure includes a gain of EUR +14 million from the divestment of the office real estate in Vantaa in December 2013.
- Operating profit was burdened by lower net sales, as well as several one-time items totalling EUR -23 (-15) million, most of which were project losses recorded in the Regional Operations. Operating profit was positive and increased in the Management Consulting Business Group. Operating profit was also positive in the Energy Business Group, the Industry Business Group and Northern Europe, but negative in all other Regional Operations Business Lines.
- In line with its strategic evolution introduced in February 2013, Pöyry further streamlined its operations in global sales and project management, the Regional Operations and the Industry and Energy Business Groups on 19 August 2014. In addition, the Group Executive Committee structure was adjusted with a view to improving efficiency.
- Pöyry concluded the implementation of its structural and administrative process improvement programme announced at the end of 2012. As these measures have been progressing, Pöyry has introduced further improvements in terms of sales focus, project management and capacity management.
The Group's parent company Pöyry PLC's net profit for 2014 amounted to EUR -14,777,499.04 and retained earnings were EUR 51,050,896.68. The total distributable earnings were EUR 36,273,397.64. Considering the challenging market situation the Board of Directors of Pöyry PLC will propose to the Annual General Meeting on 12 March 2015 that no dividend will be paid for the year 2014.
OUTLOOK FOR 2015
A significant part of Pöyry's businesses is driven by clients' new capital investments, which are mostly late in their respective economic cycles. Consequently, it is difficult to predict the exact timing of clients' investment decisions and project start-ups. Uncertainty around the general economic outlook prevails, which may impact upon investment activity in business segments that are relevant to Pöyry's operations.
Through its enhanced regional focus, Pöyry is establishing a solid foundation in key domestic markets from which it expects to generate a steady flow of projects and growth in line with prevailing market developments. In parallel, Pöyry is accessing global growth potential in conjunction with its global competences and special opportunities arising from selected large projects.
The Group's operating profit is expected to increase and be positive.
CORPORATE GOVERNANCE STATEMENT
Pöyry will publish its Corporate Governance Statement 2014 and its Financial Statements 2014 including the Board of Directors' report on 19 February 2015 at the latest. The Corporate Governance Statement will be published separately from the Board of Directors' report and financial statements, and will be published on the company's website at www.poyry.com.
MATERIALS TO THE AGM
The financial statements, the Board of Directors' report, the Corporate Governance Statement, as well as other documents presented to the Annual General Meeting will be published on the company's website at www.poyry.com on 19 February 2015 at the latest.
ALEXIS FRIES, PRESIDENT AND CEO:
"In 2014, Pöyry's comparable net sales excluding the divested business in Finland was EUR 552.4 (601.8) million and reported net sales EUR 571.2 (650.8) million. The figure declined mainly due to developments in the Regional Operations. However, it remained stable in Northern Europe. It contracted in all other regions, especially in Latin America, which was impacted by economic slowdown and delayed project awards. In addition, the figure decreased in Central Europe mostly due to project revenue adjustments.
Consolidated operating profit decreased to EUR -23.1 (13.9) million. The figure includes a write-off of the receivables from Venezuela amounting to EUR -14 million and a gain of EUR +19 million from the divestment in Finland. Both items were recognised in June 2014. The comparable figure includes a gain of EUR +14 million from the divestment of the office real estate in Vantaa in December 2013.
Operating profit was burdened by lower net sales, as well as several one-time items totalling EUR -23 (-15) million. Most one-time items were recorded in the Regional Operations and were related to project losses originating from the former Urban Business Group, as well as restructuring expenses. Operating profit was positive and increased in the Management Consulting Business Group. The figure was also positive in the Energy Business Group, the Industry Business Group and in Northern Europe, but negative in all other Regional Operations Business Lines.
The Group's order prospects were solid. However, the number of identified larger project opportunities was stagnating. The comparable order intake remained stable. The figure decreased year-on-year in the Energy Business Group, but increased from the previous quarter and the fourth quarter last year. It increased in the Management Consulting Business Group both from the previous quarter and comparable quarter last year, in the Industry Business Group on both a yearly and a quarterly basis and was stable in the Regional Operations. Several mid-sized projects were secured during the year. The comparable order stock at year-end improved slightly from EUR 461.9 million to EUR 472.5 million. The figure increased in the Industry Business Group and remained stable in other Business Lines. The reported order stock at the end of 2013 was EUR 499.7 million.
The Group's unallocated costs increased in line with expectations due to the progressing centralisation of the global support functions, related outsourcing costs, restructuring of the Group Executive Committee in August, as well as office rent following the sale of the head office building in Finland in 2013.
During the last two years, the majority of our internal and external challenges have been identified and addressed. We have streamlined the company structure, strengthened project management and administrative processes, outsourced parts of IT and finance functions, adjusted our capacity and divested real-estate related businesses in Finland. In addition, we have contained the loss-making projects originating from the former Urban Business Group. Their execution continues to comply with contractual schedules and, accordingly, will require some time to complete.
There are currently challenges in the global economy and consequently, in several Pöyry's key markets. However, the healthy foundation that we have created enables us to focus on improving our sales efforts: processes, resources, structure and activity rate. We have established an organisation dedicated to driving global sales and project management processes with a strong focus on improving performance.
As our sales pick up and the projects from the former Urban Business Group are being addressed, we expect the result to improve accordingly. Investing in the future takes time and I firmly believe we are on the right track."
This is a summary of the January-December 2014 financial statement release. The complete report is enclosed with this company announcement and is available in full on the company's website at www.poyry.com. Investors are advised to review the complete financial statement release with tables.
Jukka Pahta, CFO
tel. +358 10 33 22629
INVITATION TO CONFERENCES TODAY 4 FEBRUARY 2015
Pöyry's January-December 2014 result will be presented at the following news conferences:
- A conference for analysts, investors and press will be arranged at 12:00 p.m. Finnish time at Restaurant Savoy, Eteläesplanadi 14, Helsinki, Finland. The event will be hosted by Alexis Fries, President and CEO and Jukka Pahta, CFO.
- An international conference call and webcast in English will begin at 5:00 p.m. Finnish time (EET). The event will be hosted by Jukka Pahta, CFO.
10:00 a.m. EST (New York)
3:00 p.m. GMT (London)
4:00 p.m. CET (Paris)
The webcast may be followed online on the company's website www.poyry.com. A recording will be made available on the next working day on the same website.
To attend the conference call, please dial:
FI: +358 (0)9 2313 9201
SE: +46 (0)8 5052 0110
UK: +44 (0)20 7162 0077
US: +1 334 323 6201
Other countries: +44 (0)20 7162 0077
Due to the nature of the live webcast, we kindly ask those attending the international conference call and webcast to dial in 5 minutes prior to the start of the event.
Pöyry is an international consulting and engineering company. We serve clients globally across the energy and industrial sectors and locally in our core markets. We deliver strategic advisory and engineering services, underpinned by strong project implementation capability and expertise. Our focus sectors are power generation, transmission & distribution, forest industry, chemicals & biorefining, mining & metals, transportation and water. Pöyry has an extensive local office network employing about 6,000 experts. Pöyry's net sales in 2014 were EUR 571 million and the company's shares are quoted on NASDAQ OMX Helsinki (Pöyry PLC: POY1V).
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