THREE-MONTH REPORT 1 SEPTEMBER 30 NOVEMBER 2007

Transcription

1 THREE-MONTH REPORT 1 SEPTEMBER 30 NOVEMBER 2007 SIGNIFICANT EVENTS DURING THE PERIOD * Net sales and profit - Net sales amounted to MSEK 31 (24). - Income before taxes amounted to MSEK -231 (-205). - Income after taxes amounted to MSEK -211 (-188). - Earnings per share amounted to SEK (4.79). * Booking volumes are 6% greater than in the equivalent period of the previous year. Thanks to cold weather and an abundance of natural snow, all destinations were able to open for business in the middle of November. Further information can be obtained from: Mats Årjes, CEO Telephone: +46 (0) Magnus Sjöholm, CFO Telephone: +46 (0)

2 Three-month Report 1 SEPTEMBER 30 NOVEMBER 2007 This is SkiStar SkiStar is listed on the OMX Mid Cap, Stockholm. The Group owns and operates alpine destinations in Sälen, Åre and Vemdalen in Sweden and Hemsedal and Trysil in Norway. The Company s share of the market for SkiPass sales in Scandinavia amounts to 41%. The core business is alpine skiing, with a focus on the guest s overall skiing experience. Operations are divided into two business areas: Destinations, which consists of skiing, accommodation services, ski school and ski rentals, and Property, which includes construction and development. SkiStar s vision is to create memorable winter experiences as the leading operator of European alpine destinations. Sales and income The Group s net sales increased by MSEK 7 to MSEK 31 (24), income before taxes decreased by MSEK 26 to MSEK -231 (-205) and income after taxes decreased by MSEK 23 to MSEK -211 (-188). Earnings per share, before full conversion, amounted to SEK (-4.79). Operating income attributable to the business area Property increased by MSEK 6 to MSEK 9, primarily as a result of the sale of apartments in Sälen. Renovation costs for sold apartments amounted to MSEK 3. The Group s operating expenses in the Swedish destinations increased during the period, primarily due to an increased level of market activities as well as the newly acquired companies Vemdalens Sportaffärer & Skiduthyrning AB and Fjällinvest AB, both of which will improve the Group s income on an annual basis but will encumber operating expenses during the first quarter. Deprecation increased during the period due to the comprehensive investments made during the previous year. The Group s net financial income/expense deteriorated during the period due to higher borrowing in conjunction with a significant level of investment, a higher interest rate level and the depreciation in value by MSEK 7 of 17 tenant-owner s rights in Sälen. Cash flow Cash flow from operating activities before changes in working capital amounted to MSEK -192 (-172) and, after changes in working capital, to MSEK 53 (10). The change in working capital is primarily attributable to advance payments from booked guests. Cash flow for the period after investing activities was MSEK -65 (-240). Investments, sales and acquisitions During the period, investments amounted to MSEK 142 gross and MSEK 102 net, excluding the acquisition of Fjällinvest AB. Investments can be specified as investments in fixed assets, i.e. investments in the Group s skiing facilities, and as structural investments, which are investments in land and buildings for possible future development and sale. Fixed asset investments amounted to MSEK 50 gross and MSEK 43 net and the structural investments amounted to MSEK 92 gross and MSEK 59 net. Fixed asset investments refer principally to extensions to snow-making systems at all the Group s destinations, investments in replacements and the replacement of a 4-seat ski lift in Lindvallen with an 8-seat lift to improve capacity. The 4-seat lift, in turn, is being moved to Tandådalen, where a new slope is also being constructed. Structural investments consisted mainly of the construction of apartments in Sälen and Vemdalen, as well as the 11,000 square metre Alpine Lodge building in Hemsedal, which is estimated to be completed for the 2008/09 season. During the period, 19 apartments in Sälen were sold. At the extraordinary general meeting on 6 September 2007, the Board of Directors proposal to acquire 87% of the shares in Fjällinvest AB was approved. Fjällinvest AB carries out property investment activities at SkiStar s destinations in Sälen, Åre and Vemdalen. SkiStar previously owned 13% of the shares in the company. The price of MSEK 22.9 was established as an average of two independent valuations. The assets of the company consist of properties, primarily in Vemdalen and Sälen. The company s balance sheet amounted to MSEK 151 and equity to MSEK 25.8 per balance sheet date on 31 August. Profit before taxes for 2006/07 amounted to MSEK 5.1. The acquisition of Fjällinvest AB is a step in the strategy of developing and unbundling the Group s property development and the investment is expected to have a positive impact of approximately MSEK 5 on the Group s profit/loss during the financial year. The acquisition was completed on 10 September Liquidity and financing The Group s cash and cash equivalents amounted to MSEK 280 (262), including unutilised credit facilities of MSEK 233 (228). During the period, net interest-bearing liabilities increased by MSEK 183 to MSEK 1,795 due to the seasonally low level of revenues during the first quarter. During the period, the average interest expense (net financial income/expense as a percentage of average net interest-bearing liabilities) amounted to 5.5% (3.7). The share The number of shareholders as per 30 November was 10,246, representing an increase of 638 (7%) since 31 August Regarding the convertible loan 2003/08, during the period, conversion has taken place equivalent to 5,147 Class B shares. In total, additional convertibles equivalent to 14,850 Class B shares can be converted at a conversion rate of SEK On 6 September 2007, an extraordinary general meeting resolved to raise a new convertible debenture loan, designated 2007/12, amounting to a maximum of MSEK 30 through the issue of a maximum of 250,000 convertibles. The convertible, which was significantly oversubscribed, has a term of 5 years and a rate of conversion of SEK 138. The convertible loan was directed at the employees of SkiStar. Through conversion, the Company s share capital may increase by a maximum of SEK 125,000, corresponding to 250,000 Class B shares.

3 Complete subscription and conversion of the debenture corresponds to a dilution of approximately 0.6% of the share capital and 0.4% of the votes in the Company. Personnel During the period, the average number of employees increased by 8 (1%) to 736 individuals. Parent Company The Parent Company s net sales amounted to MSEK 24 (16) and profit/loss before income tax to MSEK -151 (-140). Prospects for 2007/2008 The current booking status for the winter season is 6% greater in volume compared to the equivalent period in the previous year. Vemdalen is showing an increase in volumes of 8%, Trysil is up by 11%, Hemsedal is up by 21% and Sälen is unchanged. Åre shows an increase in volume of 9%, excluding the effects of the Alpine World Ski Championships, and an increase of 6%, including the effects of the same. All destinations have been open for skiing since the middle of November. Due to the combination of more efficient snow-making systems, cold weather and plenty of natural snow, an excellent skiing experience has been offered early in the season. Thanks to the excellent skiing conditions early in the season, SkiPass sales up to and including 16 December increased to MSEK 15 (9). The sale of season SkiPasses up to and including 16 December also increased to MSEK 34 (25). Season SkiPasses are recorded as income during December-April. All of SkiStar s destinations will be able to offer top quality skiing at Christmas. Conditions for capital gains within the business area Property are deemed to continue to be positive, despite the fact that the higher interest rate level may reduce demand slightly. Experium Together with external investors, SkiStar is investing in an experience centre in Lindvallen, Sälen. The experience centre, which is called Experium, will include a wide variety of activities and entertainment such as an adventure pool, bowling, restaurants, playgrounds, a bio-simulator, spa, etc. The building will be approximately 11,000 square metres in size and the investment is estimated at MSEK 310. The investment is carried out in a separate company, Experium AB, which will be 40% owned by SkiStar. In addition, SkiStar will subscribe to a convertible which provides the possibility of increasing ownership to 50%. Experium is estimated to be completed for the 2009/10 winter season. The addition of Experium strengthens and modernises the range of experiences offered in Sälen. Annual General Meeting and Board Meeting The Annual General Meeting on 11 December 2007 was attended by 190 shareholders, equivalent to 74% of the votes in the Company. The following resolutions were passed at the Annual General Meeting: Dividends were established at SEK 4.50 per share (4.50). Erik Paulsson, Olof Larsson, Mats Qviberg, Eva-Karin Dahl, Mats Paulsson, Per-Uno Sandberg and Mats Årjes were re-elected as Directors. Total fees for the Board of Directors were established at TSEK 730, including TSEK 155 for the Chairman and TSEK 115 to each of the members elected by the Annual General Meeting. The registered public accounting firm, KPMG, was selected as the company s auditor for next four years. Erik Paulsson (Chairman), Mats Qviberg, Mats Paulsson and Per Limberg were elected as members of the Nominating Committee. The principles proposed by the Board of Directors regarding remuneration and other terms of employment for company management were adopted. The Board was authorised to decide upon the acquisition and transfer of the company s own shares. The following resolutions were passed at the Board Meeting following election on 11 December: Erik Paulsson was appointed Chairman of the Board. The Compensation Committee shall be composed of Erik Paulsson (chairman), Mats Qviberg and Mats Paulsson. The Audit Committee shall be composed of Per-Uno Sandberg (Chairman), Eva- Karin Dahl and Olof Larsson. Risk and uncertainty factors The number of visitors to SkiStar s desti-

4 nations is affected by weather conditions and, to a certain degree, by the presence of natural snow. A late winter and a lack of natural snow reduce demand. During November and December 2007, all of SkiStar s destinations have experienced very favourable weather conditions with an abundance of natural snow and cold weather. In principal, the ski facilities at all five destinations will be fully open for the Christmas week with the best possible conditions. At the same time, booking conditions are strong and approximately 80% of the budgeted sales of accommodations for the winter season have already been booked. The risks and uncertainty factors of the winter season have, thereby, decreased significantly since the previous report was published. Financial information Future financial reports for the financial year 2007/08 will be published as follows: Half-year Report, 1 September 29 February 2008, on 19 March Nine-month Report 1 September May 2008, on 19 June Year-end Report 1 September August 2008, on 1 October Accounting principles This three-month report has been prepared in accordance with IAS 34 Interim Financial Reporting, which is consistent with the requirements of the Swedish Financial Accounting Standards Council s recommendation RR31 Interim Financial Reporting for Groups. From 1 September 2005, SkiStar s consolidated accounts have been prepared in accordance with the IFRS standards adopted by the EU Commission. The Parent Company complies with the Swedish Annual Reports Act and the Swedish Financial Accounting Standards Council s recommendation RR 32:06, Accounting for Legal Entities. The accounting principles applied for the Group and the Parent Company correspond with the accounting principles applied in the preparation of the latest Annual Report. Consolidated income statement in summary, TSEK 1 September 30 November 1 Dec 30 Nov 1 Sep 31 Aug 3 months 12 months 12 months / /07 Net sales 31,329 24,010 1,266,033 1,258,714 Other income 13,811 5, , ,094 Total operating income 45,140 29,659 1,374,289 1,358,808 Goods for resale 5,960 3,709 81,998 79,747 Other external expenses 110, , , ,770 Personnel costs 81,237 76, , ,892 Depreciation 48,026 41, , ,981 Operating profit/loss 200, , , ,418 Financial net 30,070 12,768 77,575 60,273 Profit/loss before tax 230, , , ,145 Tax 19,743 16,868 8,839 5,964 Profit/loss for the period 211, , , ,109 - of which attributable to the Parent Company s shareholders 208, , , ,094 - of which attributable to minority shareholding 2, , Average number of shares 39,172,313 39,115,552 39,077,423 39,151,096 Average number of shares after full conversion 39,438,029 39,188,028 39,188,028 39,188,028 Earnings per share, SEK Earnings per share after full conversion, SEK Allocation of sales, MSEK 1 September 30 November 3 months SkiPass 7 4 Accomodation 3 5 Ski rental 2 1 Ski school/activities Sporting goods outlets 4 2 Property service 8 8 Capital gains 13 5 Other 8 5 Total 45 30

5 Net sales and profit/loss per operation area, MSEK Sälen Vemdalen Åre Hemsedal Trysil Property Net sales Other income Total income Operating expenses * 13 47* Depreciation Operating profit/loss Operating margin, % neg neg neg neg neg neg neg neg neg neg * Åre and Vemdalen have been charged with a larger portion of the combined costs due to increased proportions and greater utilisation. Profit/loss before tax per period, TSEK 2007/ /07 September-November 230, ,114 December-February 294,303 March-May 212,225 June-August 131,269 Consolidated balance sheet in summary, TSEK 30 November 31 August Assets Fixed assets Intangible fixed assets 217, , ,264 Tangible fixed assets 2,784,143 2,444,661 2,587,318 Financial fixed assets 150, , ,959 Deferred tax assets 6,817 Total fixed assets 3,152,317 2,729,725 2,955,541 Current assets Interest-bearing 47,180 34,117 27,572 Non interest-bearing 232, , ,135 Total current assets 279, , ,707 Total assets 3,431,795 3,083,065 3,187,248 Equity and liabilities Equity 1,043,294 1,053,892 1,257,282 Long-term liabilities Interest-bearing 1,858,891 1,545,594 1,680,425 Non-interest bearing 17,174 19,444 24,595 Deferred tax liabilities 18,732 19,584 18,493 Current liabilities Interest-bearing 31,635 14,045 13,701 Non-interest bearing 462, , ,752 Total equity and liabilities 3,431,795 3,083,065 3,187,248 Change in equity, TSEK 1 September 30 November Opening equity 1,257,282 1,248,869 Translation differences 2,908 6,731 Profit/loss for the period 211, ,246 Closing equity 1,043,294 1,053,892

6 Consolidated cash flow statement in summary, TSEK 1 September 30 November 1 Sep 31 Aug /07 Operating activities Profit/loss after financial items 230, , ,145 Adjustment for non cash items 38,986 37,809 88,294 Paid tax 503 4,661 27,535 Changes in working capital 245, ,437 45,757 Cash flow from operating activities 52,803 10, ,661 Cash flow from investment activities 117, , ,748 Cash flow from financing activities 86, , ,200 Cash flow for the year 21,502 11,600 4,113 Cash and cash equivalents at the beginning of the year 27,572 22,718 22,718 Exchange rate differences in cash and cash equivalents 2, Cash and cash equivalents at the end of the year 47,000 34,117 27,572 Unutilised credits 232, , ,573 Available liquidity 279, , ,145 Key ratios and data per share 1 September 30 November 1 Sep 31 Aug /07 Key ratios Earnings on - capital employed, % neg neg 8 - equity, % neg neg 14 - total capital, % neg neg 6 Gross margin, % neg neg 30 Operating margin, % neg neg 17 Net margin, % neg neg 13 Equity/assets ratio, % November 31 August Data per share Stock market price, SEK Average number of shares 39,172,313 39,115,552 39,151,096 Average number of shares after full conversion 39,438,029 39,188,028 39,188,028 Earnings, SEK Earnings after full conversion, SEK Cash flow, SEK* Equity, SEK Equity after full conversion, SEK Stock market price/equity, % *Cash flow before changes in working capital

7 Parent Company s income statement in summary, TSEK 1 September 30 November 3 months 1 Sep 31 Aug 12 months /07 Net sales 23,617 15, ,265 Other income 12,173 2,508 82,400 Total operating income 35,790 18, ,665 Goods for resale 4,917 3,041 55,403 Other external expenses 81,454 70, ,786 Personnel costs 58,335 56, ,311 Depreciation 26,703 23, ,786 Operating profit/loss 135, , ,379 Financial net 15,422 4,736 14,949 Profit/loss befor tax 151, , ,430 Tax 6, , , ,423 The Parent Company s balance sheet in summary, TSEK 30 November 31 August Assets Fixed assets Intangible fixed assets 15,587 14,094 16,819 Tangible fixed assets 1,586,128 1,450,555 1,540,539 Financial fixed assets 663, , ,048 Deferred tax assets Total fixed assets 2,264,734 2,025,704 1,994,406 Current assets Interest-bearing 2,866 41,740 1,180 Non interest-bearing 160, , ,296 Total current assets 162, , ,476 Total assets 2,427,722 2,275,554 2,150,882 Equity and liabilities Equity 646, , ,229 Untaxed reserves 285, , ,407 Long-term liabilities Interest-bearing 1,179, , ,551 Non-interest bearing ,936 Deferred tax liabilities 15,072 1,818 15,072 Current liabilities Interest-bearing 8,887 8,400 8,400 Non-interest bearing 292, , ,287 Total equity and liabilities 2,427,722 2,275,554 2,150,882

8 Share price trend and net sales Sälen, 20 December 2007 Mats Årjes Chief Executive Officer This three-month report has not been subject to special examination by the company s auditors. SkiStar AB (publ) SE SÄLEN Org.nr: Phone: Fax: info@skistar.com