HALF-YEARLY REPORT 1 SEPTEMBER FEBRUARY 2008

Transcription

1 HALF-YEARLY REPORT 1 SEPTEMBER FEBRUARY 2008 SIGNIFICANT EVENTS DURING THE PERIOD * SkiStar reports its best half-yearly income ever. * Net sales and profits - Net sales increased by 24% to MSEK 869 (702). - Income before taxes increased by 51% to MSEK 134 (89). - Income after taxes increased by 68% to MSEK 123 (73). - Earnings per share increased to SEK 3.14 (1.86). - Capital gains from sales of real estate decreased to MSEK 13 (34). * Booking volumes for the entire winter season are 9% greater than in the equivalent period of the previous year. * Capital gains for the whole year are estimated to amount to MSEK 50 (85). Further information can be obtained from: Mats Årjes, CEO tel +46 (0) Magnus Sjöholm, CFO tel +46 (0)

2 Half-Yearly Report 1 SEPTEMBER FEBRUARY 2008 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 During the period 1 September February 2008, the Group s net sales increased by MSEK 167 to MSEK 869 (702), income before taxes increased by MSEK 45 to MSEK 134 (89) and income after taxes increased by MSEK 50 to MSEK 123 (73). Capital gains decreased to MSEK 13 (34). Earnings per share amounted to SEK 3.14 (1.86). The previous year s income was negatively affected as Sälen in particular was heavily affected by the mild weather during December 2006 and at the beginning of January 2007, when skiing could be offered only to a limited extent. During the period, the Group s net financial income/expense has deteriorated due to higher borrowings and a higher interest rate level. During the second quarter (1 December 29 February), the Group s net sales increased by MSEK 158 to MSEK 837 (679), income before taxes increased by MSEK 71 to MSEK 365 (294) and income after taxes increased by MSEK 73 to MSEK 334 (261). Earnings per share amounted to SEK 8.53 (6.67). The interest in winter holidays in the Scandinavian mountains in general, and in SkiStar s destinations in particular, is higher than ever. This has resulted in SkiStar s best half-yearly result ever. During the entire winter season, SkiStar s destinations have offered very good conditions for skiing. The Group s SkiPass sales, referring principally to the second quarter, increased by 27% to MSEK 499 (394). The average price increase on SkiPasses was about 4%. In Sälen, net sales increased by MSEK 76 to MSEK 318 and operating income by MSEK 63 to MSEK 83 in comparison with the previous year. SkiPass sales increased by 42% to MSEK 162. In Vemdalen, net sales increased by MSEK 22 to MSEK 84 and operating income by MSEK 7 to MSEK 15. SkiPass sales increased by 20% to MSEK 42. In Åre, net sales increased by MSEK 24 to MSEK 185 and operating income by MSEK 14 to MSEK 29. SkiPass sales increased by 26% to MSEK 115. In Hemsedal, net sales increased by MSEK 15 to MSEK 126, while operating income decreased by MSEK 5 to MSEK 18. SkiPass sales, which were unchanged in local currency, amounted to MNOK 59 but, converted into SEK, they increased by 7% to MSEK 70. The declining result in Hemsedal is an effect of the fact that the income classes with the highest operating margin, SkiPasses and ski rentals, have not increased to a larger extent, while operating expenses have increased due to general increases in costs. Hemsedal was one of the few skiing destinations in Scandinavia last year that could offer good conditions during the full winter season and, consequently, Hemsedal then presented strong growth in sales and income. In Trysil, net sales increased by MSEK 28 to MSEK 155 and operating income by MSEK 14 to MSEK 34. SkiPass sales increased by 16% in local currency to MNOK 93 and, converted into SEK, increased by 24% to MSEK 110. Exchange rate fluctuations regarding NOK/SEK have positively affected sales in the Norwegian operations by MSEK 17 and operating income by MSEK 4. Business Area Property reported an operating income of MSEK 9 (31), mainly from sales of apartments in Sälen. The Scandinavian market According to preliminary figures from SLAO (the Swedish Ski Lift Organisation), SkiPass sales in Sweden increased by 12% during the period November 2007 February 2008, compared with the equivalent period of the previous year. The average price increase of SkiPasses in Sweden was 4%. In Norway, SkiPass sales during the period increased by 25%, while the average price increase for SkiPasses was 4%, according to ALF (the Norwegian Alpine Resorts Association). Cash flow Cash flow from operating activities before changes in working capital amounted to MSEK 236 (141) and, after changes in working capital, to MSEK 635 (416). Cash flow for the period after investing activities was MSEK 416 (52). Investments, sales and acquisitions Excluding the acquisition of Fjällinvest AB, investments for the period amounted to MSEK 217 gross and MSEK 204 net. 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

3 development and sale. Fixed asset investments amounted to MSEK 85 gross and MSEK 84 net and structural investments amounted to MSEK 132 gross and MSEK 120 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. Above all, apartments in Sälen have been disposed of during the period. 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 shares in the company. The price of MSEK 23 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 26 per balance sheet date on 31 August. Profit before taxes for 2006/07 amounted to MSEK 5. 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 Sales trends During the season 2007/08, the number of foreign guests booking through SkiStar has increased heavily. The number of guests from Denmark, the largest foreign market, has increased by 18%, measured in terms of guest nights. However, the largest increase refers to countries outside Scandinavia, where the number of guest nights has increased by approximately 30% to over 30,000, compared with the same period in the previous year. This increase is due to the increased breakthrough for SkiStar s destination trademarks abroad, combined with renewed and improved collaboration with foreign travel agents. Another contributing factor is the possibility for foreign guests to easily book their stay directly at skistar.com. Sales over the Internet have also increased strongly on the domestic market. Internet sales now comprise 60% of advance sales, that is to say sales prior to arrival. Liquidity and financing The Group s cash and cash equivalents amounted to MSEK 563 (385), including unutilised credit facilities of MSEK 451 (288). During the period, net interestbearing liabilities decreased by MSEK 103 to MSEK 1,509. During the period, the average interest expense (net financial income/expense as a percentage of average net interest-bearing liabilities) amounted to 5.6% (4.7). The share The number of shareholders as per 29 February was 10,971, representing an increase of 1,363 (14%) since 31 August The number of shares on the date of reporting amounted to 39,173,178. Through the convertible loan 2003/08, convertibles equivalent to a total of 14,851 additional 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. 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 49 (3.9%) to 1,305 individuals. The increase can be largely attributed to the acquisition of Vemdalens Sportaffärer & Skiduthyrning AB, as well as the recently initiated ski rental and increased ski school activities in Hemsedal. The parent Company The Parent Company s net sales amounted to MSEK 576 (437) and profit/loss before income tax to MSEK 90 (32). Risk and uncertainty factors The number of visitors to SkiStar s destinations is affected by weather conditions and, to a certain extent, by natural snow conditions. A late winter and lack of natural snow decreases demand. During the season, all of SkiStar s destinations have had very favourable weather conditions with an abundance of natural snow, which means that conditions are favourable for the possibility of offering good skiing during the end of the season. Sales of accommodation for the winter season have been largely completed, apart from the weeks after Easter where there remains a certain amount of vacancy. The early Easter this year, combined with an early onset of spring in southern Sweden, may reduce demand to a certain degree during the month of April. Prospects for 2007/2008 Snow conditions at all of SkiStar s destinations have been favourable, which implies favourable possibilities for offering good skiing during the end of the season. For the entire winter season (start of season 1 May), the number of booked skier days increased by 9% compared with the previous year. Sälen shows an increase in volume of +12%, Åre +6%, Vemdalen +8%, Hemsedal +6% and Trysil +10%. Occupancy rates of cabins and apartments owned or mediated by SkiStar during the period Christmas week 1 May 2007/08 is estimated to amount to 85% (80%).

4 The number of owned and mediated objects has increased by a total of 2% compared with the previous year. The increase in booking volume is primarily an effect of the improvement in booking rates during Christmas and the New Year. Capital gains within the Business Area Properties are estimated to amount to MSEK 50 for the entire business year. Outlook for 2008/09 During the 2008/09 winter season, investments in accommodation are estimated to amount to MSEK 200. Investments primarily include the continued extension of the snow-making systems at all destinations, as well as the construction of a new 6-chair express lift at Klövsjö in Vemdalen. The lift, which will be named the Klövsjö Express, is jointly financed by SkiStar and a number of local companies. The lift will be operated by SkiStar. In addition, skiing will be restructured in the other areas, snow-making systems will be reinforced and lighting will be installed on the main slalom slope, Storslalombacken. Furthermore, investments are continuing in the 11,000 square metre Alpine Lodge building in Hemsedal, which will be completed by November The investments amount to MNOK 160. A new experience centre, Experium, is being planned at Lindvallen in Sälen. Experium will include a wide variety of activities and entertainments such as an adventure pool, bowling, restaurants, playgrounds, a bio-simulator, spa, etc. The building will be just over 11,000 square metres in area and the investment, which is estimated at MSEK 310, will be executed in a separate company, Experium AB, 49% of which will be indirectly owned by SkiStar. Experium is expected to be completed by the 2009/10 winter season. Through the addition of Experium, the range of experiences available in Sälen will be strengthened and modernised. SkiStar has applied for a license to run its own insurance company. Currently, the range of insurance is primarily comprised of cancellation protection and ski equipment rental insurance. The purpose of the new insurance company is the further development of insurance activities, as well as cost reduction. The government has commissioned an inquiry to review the taxation of nonprofit associations and foundations. Among other things, this inquiry will include an overhaul of the regulations regarding tax exemptions for properties with special tax rates, which are currently utilised in SkiStar s operations in Sweden. The inquiry is expected to be completed by June SkiStar is planning to invest in a selfcontained, car free ski resort, the Sälen Högfjällsresort, by the Höfjällshotellet in Sälen. Apart from 92 owner-occupied apartments with a total of 700 beds, there will also be shopping, swimming, a spa and an ice-skating rink, among other features. Initial construction, planned for May 2009, is under the condition that 75% of the apartments have been signed with binding terms. Financial information Future financial reports for the financial year 2007/08 will be published as follows: Nine-month Report, 1 September May 2008, on 19 June Year-End Report, 1 September August 2008, on 1 October Accounting principles This half-yearly 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.

5 Consolidated income statement in summary, TSEK 1 December 29/28 February 1 September 29/28 February 1 March 29/28 Feb 1 Sep 31 Aug 3 months 6 months 12 months 12 months 2007/ / / / / /07 Net Sales 837, , , ,944 1,420,309 1,258,714 Ohter income 68 30,414 13,557 36, , ,094 Total operating income 837, , , ,762 1,530,228 1,358,808 Goods for resale 39,395 39,088 45,355 42,797 87,950 79,747 Other external expenses 180, , , , , ,770 Personnel costs 177, , , , , ,892 Depreciation 51,741 46,301 99,767 87, , ,981 Operating profit/loss 389, , , , , ,418 Financial net 24,249 15,437 54,319 28,205 97,375 60,273 Profit/loss before tax 364, , ,962 89, , ,145 Tax 30,830 33,306 11,087 16,438 8,880 5,964 Profit/loss for the period 333, , ,875 72, , ,109 -of which attributable to the Parent Company s sharholders 332, , ,615 72, , ,094 -of which attributable to minority shareholding 1,365 1, , Avarage number of shares 39,173,178 39,155,514 39,172,746 39,135,533 39,169,702 39,151,096 Avarage number of shares after full conversion 39,438,029 39,188,028 39,438,029 39,188,028 39,438,029 39,188,028 Earnings per share, SEK Earnings per share after full conversion, SEK Allocation of sales, MSEK 1 September 29/28 February 2007/ /07 SkiPass Accomodation Ski rental Skischool/Activities Sporting goods outlets Property services Capital gains Other Total Net sales and profit/loss per operation area, MSEK Sälen Vemdalen Åre Hemsedal Trysil Property 2007/ / / / / / / / / / / /07 Net sales Other income Total income Operating expenses Depreciation Operating profit/loss Operating margin, %

6 Profit/loss before tax per period, TSEK 2007/ /07 September November 230, ,114 December February 364, ,303 March May 212,225 June August 131,269 Consolidated balance sheet in summary, TSEK 29/28 February 31 August Assets Fixed assets Intangible fixed assets 225, , ,264 Tangible fixed assets 2,834,821 2,471,880 2,587,318 Financial fixed assets 144, , ,959 Total fixed assets 3,205,136 2,803,815 2,955,541 Current assets Interest-bearing 111, ,948 27,572 Non-interest bearing 290, , ,135 Available-for-sale assets 50,996 Total current assets 402, , ,707 Total assets 3,607,897 3,329,314 3,187,248 Equity and liabilities Equity 1,206,471 1,146,593 1,257,282 Long-term liabilities Interest-bearing 1,655,027 1,492,047 1,680,425 Non-interest bearing 17,629 18,370 24,595 Defferred tax-liabiliies 19,233 31,068 18,493 Current liabilities Interest-bearing 14,213 27,590 13,701 Non-interest bearing 695, , ,752 Liabilities attributable to assets available for sale 3,922 Total equity and liabilities 3,607,897 3,329,314 3,187,248 Pledged assets and contingent liabilities Pledged assets 1,897,626 1,364,293 1,831,536 Contingent liabilities 62,704 61,677 57,708 Change in equity, TSEK 1 September 29/28 Februariy 2007/ /07 Opening equity 1,257,282 1,248,869 Conversion of convertibles 357 Dividend 176, ,180 Translation differences 2, Profit/loss for the period 122,875 72,751 Closing equity 1,206,471 1,146,593

7 Consolidated cash-flow statement in summary,tsek 1 September 29/28 February 1 Sep 31 Aug 2007/ / /07 Operating activity Profit/loss after financial items 133,962 89, ,145 Adjustment for non cash items 95,317 49,657 88,294 Paid tax 7,073 2,584 27,535 Changes in working capital 398, ,080 45,757 Cash flow from operating activities 634, , ,661 Cash flow from investment activities 219, , ,748 Cash flow from financing activities 332,118 21, ,200 Cash flow for the period 83,387 72,912 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 694 1, Cash and cash equivalents at the end of the year 111,653 97,248 27,572 Unutilised credits 451, , ,573 Available liquidity 562, , ,145 Key ratio and data per share 1 September 29/28 February 1 Sept 31 Aug 2007/ / /07 Key ratios Earnings on - capital employed, % equity, % total capital, % Gross margin, % Operating margin, % Net margin, % Equity/assets ratiot, % /28 February 31 August Data per share Stock market price, SEK Avarage number of shares, 39,172,746 39,135,533 39,151,096 Avarage 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 *Cash flow before changes in working capital

8 Parent Company s income statement in summary, TSEK 1 December 29/28 February 1 September 29/28 February 1 Sep 31 Aug 3 months 6 months 12 months 2007/ / / / /07 Net sales 552, , , , ,265 Other income 2,721 30,256 14,894 32,764 82,400 Total operating income 555, , , , ,665 Goods for resale 33,321 27,614 38,238 30,655 55,403 Other external expenses 115, , , , ,786 Personnel costs 113, , , , ,311 Depreciation 28,142 26,070 54,845 50, ,786 Operating profit/loss 254, , ,022 43, ,379 Financial net 13,481 6,757 28,903 11,493 14,949 Profit/loss before tax 241, ,891 90,119 31, ,430 Tax 795 1, ,112 6,007 Profit/loss for the period 240, ,779 89,324 30, ,423 The parent Company s balance sheet in summary, TSEK 29/28 February 31 August Assets Fixed assets Intangible fixed assets 19,687 12,890 16,819 Tangible fixed assets 1,588,377 1,460,148 1,540,539 Financial fixed assets 668, , ,048 Total fixed assets 2,276,425 2,128,616 1,994,406 Current assets Interest-bearing 6,031 61,482 1,180 Non-interest bearing 193, , ,296 Total current assets 199, , ,476 Total assets 2,476,384 2,433,411 2,150,882 Equity and liabilities Equity 710, , ,229 Untaxed reserves 285, , ,407 Long-term liabilities Interest-bearing 1,000,214 1,031, ,551 Non-interest bearing ,936 Defferred tax-liabiliies 15,072 1,818 15,072 Current liabilities Interest-bearing 8,400 8,400 8,400 Non-interest bearing 456, , ,287 Total equity and liabilities 2,476,384 2,433,411 2,150,882 Pledged assets and contingent liabilities Pledged assets 669, , ,369 Contingent liabilities 658, , ,123

9 Share price trend and net sales This half-yearly report gives a true and fair view of the Parent Company s and the Group s operations, financial position and results of operations and describes the material risks and uncertainties faced by the Parent Company and the companies included in the Group. Sälen, 19 March 2008 Erik Paulsson Eva-Karin Dahl Mats Paulsson Mats Qviberg Mats Årjes Chairman CEO Catarina Hjalmarsson Olof Larsson Per-Uno Sandberg Bengt Larsson Employee representative Employee representative This half-yearly report has not been the subject of a review by the company s auditors. SkiStar AB (publ) SE SÄLEN Org.nr: Tel: Fax: E-post: info@skistar.com