Fiskars Corporation Stock Exchange Release November 1, 2007 at 08.30 am. FISKARS CORPORATION INTERIM REPORT JANUARY-SEPTEMBER 2007 (Unaudited) Fiskars profitability improved and growth continued and was enhanced by Iittala acquisition Third quarter highlights - Net sales were EUR 148.3 million (119.4) - Operating profit for wholly-owned businesses was EUR 16.7 million (6.0) - Iittala Group Plc was purchased at the end of August and has been consolidated from the beginning of September - Iittala's net sales in September were EUR 16.0 million and operating profit after EUR 1.1 million purchase price allocation was EUR 0.3 million - Income from Wärtsilä was EUR 11.1 million (6.9) - Sale and purchase of Wärtsilä shares yielded a gain of EUR 16.8 million FISKARS CORPORATION IN BRIEF EUR, million Q3/2007 Q3/2006 1-9/2007 1-9/2006 2006 Net sales 148.3 119.4 465.7 409.8 534.9 Operating profit from 16.7 6.0 52.2 25.0 27.2 wholly-owned businesses Income from associate 11.1 6.9 26.6 40.8 58.6 Operating profit 27.8 13.0 78.8 65.8 85.8 Pre-tax profit 41.4 10.6 88.4 58.1 76.7 Net profit for the period 38.2 9.8 78.1 72.5 82.0 Earnings/share from 0.49 0.10 1.01 0.74 0.86 continuing operations, EUR Earnings/share, total, 0.49 0.13 1.01 0.94 1.06 EUR Cash from operations 21.8 30.5 52.1 72.0 99.0 FISKARS CORPORATION Third quarter, July-September 2007 In the third quarter Fiskars net sales increased by 24.2% compared to the year before, totaling EUR 148.3 million (119.4). The increase in net sales generated by recent acquisitions was EUR 22.0 million or 18.4%. The Corporation's operating profit was EUR 27.8 million (13.0). Operating profit for the wholly-owned businesses was EUR 16.7 million (6.0) or 11.3% of net sales (5.1). Income from Wärtsilä that is included in the operating profit was EUR 11.1 million (6.9). Net financial costs were EUR 3.1 million (2.4) and the pre-tax profit was EUR 41.4 million (10.6). During the third quarter, the Corporation sold Wärtsilä B-shares and bought shares of series A on the stock exchange. The gross number of shares traded was 452,008 shares at a value of EUR 20.7 million. The sale yielded a gain of EUR 16.8 million. Fiskars ownership of Wärtsilä shares remained unchanged and the number of votes increased. Income taxes for continuing operations were EUR 3.2 million (2.7). The net profit for the quarter was EUR 38.2 million (9.8) and earnings per share were EUR 0.49 (0.13). Changes in corporate structure The acquisition of Iittala Group Plc was closed on the last day of August. Iittala Group is a leading homeware design company and a pioneer of modern Scandinavian design. Iittala Group's home markets are Finland, Sweden, and Norway, and the company's strong brands in these markets are Iittala, Arabia, Hackman, BodaNova, Höganäs Keramik, Rörstrand, and Höyang-Polaris. In addition to the parent company in Finland, subsidiaries in Sweden, Norway, Denmark, the Netherlands, the US, Germany, and Estonia are part of the Iittala Group. The company has production facilities in Helsinki, Nuutajärvi, Iittala, Sorsakoski, and Vähäkyrö in Finland; in Höganäs in Sweden; and in Moss in Norway. Iittala sells products both to retailers and directly to consumers through its chain of Iittala Shops and factory outlets. Iittala had a total of 38 factory outlets in Finland, Sweden, and Norway, in addition to which there were 26 Iittala Shops in six countries at the end of August. Iittala Group's net sales in 2006 totaled EUR 189.8 million, with an operating profit of EUR 17.0 million and a staff of 1,353. Wholesales comprised 73% of sales the remaining part being Iittala's own retail sales. Total assets for the Iittala Group at the end of August were EUR 161.6 million. The EUR 119.4 million in loans included in the assets at the time of purchase were refinanced. The management of the company stayed on as minority shareholders of Iittala Group Ltd. with a combined ownership of 2.28% of the shares. Fiskars Corporations investment in Iittala was EUR 219.6 million. The preliminary purchase price allocation is disclosed under "Impact of acquisitions on the consolidated balance sheet". Iittala has been consolidated in Fiskars Corporation from the beginning of September. Iittala forms a new reporting segment within Fiskars Corporation. Iittala's operations are quite seasonal, with most of the profits being generated in the last quarter. This will even out the seasonal fluctuations of Fiskars operations. January-September 2007 review period Fiskars net sales increased by 13.6% in the review period, totaling EUR 465.7 million (409.8). The acquisitions made in the past twelve months have generated a considerable share of the growth; the Silva Group represented EUR 24.0 million, Leborgne S.A. EUR 6.8 million and Iittala EUR 16.0 million in growth, totaling 11.4%. The discontinuation of floor- mat and watering product lines in the United States at the end of 2006 represented a decrease in the period's net sales of EUR 16.7 million. The weakening of the US dollar decreases both the percentage of sales in the US as well as the consolidated net sales figures. With constant exchange rates, then increase in sales would have been 17.2%. During the review period, 55.1% of net sales were generated in Europe (47.0%) and 38.7% in the USA (45.2%). Operating profit was EUR 78.8 million (65.8). The operating profit for the Corporation's wholly-owned operations was EUR 52.2 million representing 11.2% of net sales. Profitability of the industrial operations improved and an increase in the value of standing timber of EUR 10.2 million (2.6) further contributed to improved operating profits. The operating profit for the review period includes non-recurring gains from fixed assets totaling EUR 1.4 million and the operating profit for the corresponding period last year included EUR 6.4 million non-recurring restructuring costs. The net financial costs of EUR 7.2 million (7.6) were slightly lower than the previous year as they include some gains on investment. The EUR 16.8 million gain from the trade in Wärtsilä stock improves the pre-tax result, which was EUR 88.4 million (58.1). The net profit for the review period was EUR 78.1million (72.5). The profit for the corresponding period last year includes profits and gain on sale from discontinued operations totaling EUR 14.9 million. Personnel totaled 4,484, having been 3,003 at the end of 2006. The number of staff increased due to the 1,382 people working at Iittala and the 120 people at Leborgne S.A. FISKARS BRANDS Third quarter, July-September 2007 Fiskars Brands' net sales increased by 9.5% and were EUR 121.0 million (110.5). The operating profit improved significantly and was EUR 12.1 million (3.3). The operating profit percentage was 10.0% (3.0). The operating profit for the corresponding period last year included non- recurring restructuring costs of EUR 1.4 million. The profitability of Fiskars Brands' operations improved from last year. Discontinuation of the the less profitable product lines as part of the restructuring measures implemented in the United States has improved the operating profit. The restructuring project begun in 2005 has now been completed and the bulk of the products sold in the US are now outsourced. This has also contributed on the profitability. In Europe, increased sales volumes have contributed to an improved capacity utilization, which in turn has improved profitability. An increase in the share of new products sold has also improved profitability. January-September 2007 review period Fiskars Brands net sales increased by 7.1% and was EUR 403.6 million (376.9). The operating profit was EUR 41.9 million (21.1). Operating profit for the review period included a EUR 1.4 million non-recurring gain on sale of fixed assets. The corresponding period last year included restructuring costs of EUR 6.4 million. Thus the comparable profitability was 10.0% (7.3%). Net sales increased in particular through acquisitions. The acquisition of Silva Group in 2006 increased sales of outdoor recreation products by EUR 24.0 million in Europe and the US. The acquisition in May this year of Leborgne S.A., the French company manufacturing and marketing garden hand tools, increased net sales in Europe by EUR 6.8 million. Integration of Leborgne to Fiskars' European garden business has progressed according to plan and will be finalized during the last quarter. The weakening dollar had a negative impact on sales, as did the discontinuation of the floor-mat and watering product lines in the USA in the Fall of last year. Gerber's net sales in Outdoor Recreation categories increased clearly from last year in the US.Gerber has gained more shelf space in some large retail chain stores in the US and earlier this year also signed a significant agreement to deliver products for government and military use. New products were launched in all product categories and in all markets and their share of sales has increased. The one-off marketing effort to increase the sales of Fiskars Brands' garden tools in the US has proved a success. The large retail chains make their product and Stock-Keeping- Unit selections based on annual decision making schedules and major changes are always possible. Investments during the review period totaled EUR 22.0 million (32.4). They include the EUR 13.2 million acquisition cost for Leborgne S.A., while the investments in the corresponding period last year included the acquisition of Silva Group. Fiskars Brands personnel numbered 2,739 at the end of the review period, an increase of 80 people since the beginning of the year. The increase was due to the acquisition of Leborgne, and an increase in the capacity of Gerber's outdoor recreation production line to meet a large delivery contract. In the company's other US operations, the number of personnel has continued to decrease. IITTALA Iittala has been consolidated in Fiskars Corporation from the beginning of September. In September Iittala's net sales were EUR 16.0 million and the operating profit before the impact of the purchase price allocation was EUR 1.4 million. The operating profit after purchase price allocation was EUR 0.3 million. There are some market and product overlaps between Iittala and the Housewares product category of Fiskars Brands. Synergy benefits are expected from combining operations, more efficient administration and wider use of distribution channels; these synergy benefits are expected to materialize from the beginning of the next year. Iittala's personnel numbered 1,382 at the end of September. INHA WORKS In the review period, net sales for Inha Works increased by 18.7% compared to last year, totaling EUR 33.3 million (28.1). Operating profit was EUR 3.4 million (2.9). Profitability was at last year's level and the operating profit percentage was 10.1 (10.4). The increase in the cost of raw materials has cut into the profit margin. The third quarter is typically less profitable, as the main sales period ends with the ending of the boating season and the new model season has yet to begin. Boat sales increased again this year in all the most important markets for Buster boats. Investments in production have made it possible to respond to increased demand, but once again the factory worked to its full capacity. The new Buster X has become one of the most popular boat models. The forged products operations developed according to plan; a downturn in the demand for hinges has caused preparations to adapt production accordingly. During the review period, the company has invested considerably more than before in product development. The boat range will be complemented with new boats that respond to market expectations and fit into the company's long-term strategy. For the next boating season, the Buster range is supplemented by the new XXL model, which was launched in September. In early 2008, the new XXL will be joined by it's sister boat, a completely new type of Buster, the AWC - All Weather Cruiser - featuring a covered cockpit. Investments during the review period were EUR 2.6 million (0.6). Personnel totaled 310 at the end of the review period (301 at the beginning of the year). REAL ESTATE Net sales for the Real Estate Group during the review period was EUR 14.6 million (6.7). The operating profit was EUR 11.4 million (5.2). The price of standing timber has been increasing for a year, resulting in an increase of EUR 10.2 million (2.6) in net sales and operating profit . The total value of the Fiskars Corporation standing timber at the end of the review period was EUR 45.6 million (35.4). No major real estate deals were made during the review period and the renting business developed according to plan and the operating cash flow was close to zero. Investments by the Real Estate operations totaled EUR 1.3 million (1.5). The number of staff at the end of the summer period was still 36 (27 at the beginning of the year). ASSOCIATED COMPANY WÄRTSILÄ Fiskars' income from associate Wärtsilä for the review period was EUR 26.6 million (40.8). Wärtsilä's net profit for the corresponding period last year included a significant gain from the divestment of shares in Assa Abloy and a share in the associate Ovako's net profits. Fiskars' share of Wärtsilä equity and votes was 16.5% (16.8%) and 32.6% (30.6%) respectively. The change in the votes was due to a trade of shares of series B for shares of series A during the third quarter. The book value of Fiskars' investment in the associate was EUR 256.5 million (239.1 at the beginning of the year). Dividends paid to Fiskars in the review period totaled EUR 27.7 million (23.7). Some EUR 54.3 million of the book value of Fiskars' holding in Wärtsilä was goodwill (37.7 at the beginning of the year). The market value of Fiskars shares in Wärtsilä was EUR 765 million (price of A share EUR 48.60 and B share EUR 48.05) at the end of the review period. PROFITS AND TAXES Net financial costs for the review period were EUR 7.2 million (7.6). The financial income for the review period was slightly higher than during the corresponding period last year. Profit before taxes totaled EUR 88.4million (58.1). Income taxes for the review period have been calculated on the basis of the local accumulated income and the enacted tax rates while taking into consideration the potential use of deferred tax assets and the estimated whole-year effective tax rate. Taxes totaled EUR 10.3 million; the taxes for the corresponding period last year were EUR 0.5 million, less due to the tax treatment of discontinued operations. The net profit for the period derived from continuing operations was EUR 78.1 million (57.6). The Power Sentry division, divested in the summer of 2006, was reclassified in 2006 as discontinued operations and its net profit for last year's first quarter is reported accordingly. The net profit for the review period was EUR 78.1 million (72.5). The earnings per share attributable to equity holders of the company was EUR 1.01 (0.94). BALANCE SHEET AND FINANCING Total assets were EUR 1,027.9 million (707.2 at the beginning of the year). The acquisition of the Iittala Group resulted in a significant growth in assets. The transaction resulted in an increase in inventories by EUR 60.6 million and trade receivables by EUR 18.2 million and in long-term assets by EUR 218.8 million of which EUR 139.8 million comes from purchase price allocation. Growth in business further increased trade receivables, inventories and trade payables. Net working capital was EUR 166.0 million, or EUR 61.3 million more than at the end of the year; of this, growth in business created EUR 5.6 million while Iittala's share of increase was EUR 47.3 million and Leborgne's EUR 8.4 million. The Corporation's interest-bearing net debt was EUR 345.7 million, or EUR 243.8 million more than at year-end. Net cash flow from operating activities was EUR 52.1 million (72.0). Net cash used in investing activities totaled EUR 250.3 million. In the corresponding period last year, the cash used in investing activities was EUR 5.8 million, as investments were financed through divestments. The equity to assets ratio was 44% (60 at the beginning of the year). Net gearing was 76% (24 at the beginning of the year). The significant changes in these key figures are primarily caused by the acquisition of Iittala and Leborgne. The Corporation's financial situation and liquidity remain strong. In addition to cash and cash equivalents, the Corporation has significant credit facilities available. MANAGEMENT OF RISKS AND UNCERTAINTIES Fiskars' most important operational risks relate to supply-chain control, the potential structural changes in the retail environment in various markets and also partly to the development of the prices of raw materials and energy. Efforts are made in particular to improve supply chain management and build ties to subcontractors, as outsourcing is increased in accordance with the Corporation's strategy. In order to mitigate possible problems with subcontractors and logistics, the Corporation has also increased inventories. The potential structural changes in distribution channels are seen to represent a risk mainly in the US, and operations are required to increase flexibility and the ability to think ahead. The nature of most of the company's industrial operations is such that they pose no significant environmental risks. Changes in environmental directives and changes in production capacity or structure may cause additional costs at some older production facilities. The company is committed to complying with legislation and statutes for the protection of the environment and strives to develop its production and mode of operation in ways that minimize the burden on the environment. The Fiskars Corporation Board of Directors regularly reviews the principles for the management of financial risks and in accordance with the Corporation's investment policies, liquid assets are only invested in low- risk entities. Trade receivables are relatively widely spread geographically and between customers, and major customers generally have a high credit rating. No significant credit losses have materialized during the review period. The Corporation has hedged a certain part of its most significant foreign currency net investments in its subsidiaries against exchange rate fluctuations and as from January 1, 2007 it has applied hedge accounting in accordance with the IAS 39 standard. A portion of the company's electricity purchases have also been hedged against fluctuations in the energy market and hedge accounting in accordance with the IAS 39 standard is also applied to these instruments. REPURCHASE AND TRANSFER OF OWN SHARES Until the Annual General Meeting held March 21, 2007, the Board of Directors had an authorization to repurchase and decide on the distribution of the Corporation's shares provided that the total nominal value of such shares and the votes carried by them did not exceed ten percent (10%) of the share capital and the total votes in the company. At the Annual General meeting on March 21, 2007 the authorization was renewed unchanged. The Board has not exercised its authorization during the review period. As at September 30, 2007, the company held in total 127,512 of its own A shares and 420 K shares. The holding has not changed during the review period, and the number of shares equals 0.2% of the entire share capital of the company. The EUR 0.9 million repurchase cost of the Corporation's own shares decreases the Corporation's equity. SHARE PRICES Fiskars shares are traded on the Nordic list of the Helsinki Exchange. The shares were moved to the Large Cap Helsinki segment on July 1, 2007. At the end of September, the price of the Fiskars A share was EUR 13.38 (12.29 at the beginning of the year) and the price of the K share EUR 14.20 (12.11). The market value of the Corporation's share capital was EUR 1,054 million at the end of the review period. CHANGES IN OWNERSHIP On September 4. 2007 Fiskars Corporation was informed that Virala Oy Ab had increased its holdings to more than 1/5 of the voting rights in Fiskars Corporation. Holdings of share capital are still more than 1/10. The shares of votes and shares were on September 4. 2007 20,2% and 11.1% respectively. On September 4. 2007 Fiskars Corporation was informed that Varma Mutual Pension Insurance Company had decreased its holdings to less than 1/20 of the voting rights in Fiskars Corporation. The shares of votes and shares were on September 4. 2007 2.7% and 4.3% respectively. ANNUAL GENERAL MEETING 2007 The Annual General Meeting of shareholders on March 21, 2007 decided to pay a dividend of EUR 0.60 per share for A shares, totaling EUR 32,890,188, and EUR 0.58 per share for K shares, totaling EUR 13,087,867, the sum total for both series of shares being EUR 45,978,055. It was decided that the number of Board members be nine. Mr. Kaj-Gustaf Bergh, Mr. Alexander Ehrnrooth, Mr. Paul Ehrnrooth, Mr. Ralf Böer, Mr. David Drury, Ms. Ilona Ervasti-Vaintola, Mr. Gustaf Gripenberg, Mr. Karl Grotenfelt, and Mr. Clas Thelin were elected to the Board. The term of the Board members will expire at the end of the Annual General Meeting in 2008. KPMG Oy Ab was elected auditor. The Annual General Meeting decided to authorize the Board to repurchase, of the company's own shares, no more than 5,366,937 of series A and no more than 2,256,150 of series K shares in a proportion other than that of the shareholders' proportional shareholdings. The share price will be no higher than the highest price paid for Fiskars Corporation shares in public trading at the time of repurchase. This authorization shall remain in force until the end of the next Annual General Meeting. The Annual General Meeting authorized the Board to decide on the distribution of the company's repurchased shares up to a maximum of 5,494,449 series A shares and up to a maximum of 2,256,570 series K shares. The Board may decide on the distribution of the shares otherwise than in proportion to the shareholders' existing pre-emptive subscription rights. This authorization shall remain in force until the end of the next Annual General Meeting. In its organization meeting the Board elected Kaj-Gustaf Bergh its chairman and Alexander Ehrnrooth and Paul Ehrnrooth vice chairmen. The Board decided to establish an Audit Committee, a Compensation Committee, and a Nomination Committee. The Board appointed Gustaf Gripenberg chairman of the Audit Committee, and David Drury, Ilona Ervasti-Vaintola, Alexander Ehrnrooth and Paul Ehrnrooth as its other members. The Board appointed Kaj-Gustaf Bergh chairman of the Compensation Committee and Ralf Böer, Karl Grotenfelt and Clas Thelin as its other members. The Board appointed Kaj-Gustaf Bergh chairman of the Nomination Committee and Alexander Ehrnrooth and Paul Ehrnrooth its other members. CHANGE IN CORPORATE MANAGEMENT On August 13, the Fiskars Board of Directors appointed Mr Kari Kauniskangas, M.Sc (Econ), President and CEO of Fiskars Corporation from the beginning of 2008.Mr Heikki Allonen will continue as President and CEO until the end of 2007. OUTLOOK Fiskars Corporation net sales are estimated to grow by around 20% in 2007 compared to the previous year largely as a result of the made acquisitions. Operating profits from the operations wholly owned by Fiskars are also estimated to increase from last year, driven by both improvements in Fiskars Brands, standing timber and by the consolidation of Iittala which is estimated to generate the bulk of its profits during the last months of the year. Due to the general uncertainty on the markets it is becoming more difficult to forecast the development of the consumer markets, especially in the United States. The share of profits from the associated company Wärtsilä is again estimated to form a substantial part of Fiskars' operating profit in 2007. Heikki Allonen President and CEO NOTES TO THE INTERIM REPORT This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting. Using the same accounting principles and methods of computation as for the annual financial statements for 2006 with the exception of hedge accounting being applied on foreign currency net investments in subsidiaries and changes in the market price for electricity. Use of estimates Complying with the IFRS standards in preparing financial statements requires the management to make estimates and assumptions. Such estimates affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the amounts of revenues and expenses. Although these estimates are based on the management's best knowledge of current events and actions, actual results may differ from these estimates. Sale and purchase of Wärtsilä shares Fiskars Corporation has sold Wärtsilä's A shares and acquired an equal amount of B shares increasing Corporation's voting right in Wärtsilä by 1.3% to 32.6%. Management has assessed that there is a commercial substance in selling A shares and buying equal amount of B shares, and, therefore, adopted an accounting policy to recognize the transaction at fair value. IAS 39 Financial instruments - hedge accounting for foreign currency net investments in subsidiaries Significant equity investments in subsidiaries situated outside the Euro zone have largely been hedged against foreign currency exchange rate fluctuations through foreign currency loans and derivatives using the hedge accounting to reduce the effect of exchange rate fluctuations on the consolidated equity. When a foreign subsidiary is sold, these translation differences are included in the gain or loss on disposal reported in the income statement. Application of hedge accounting resulted in an increase in the review period's equity of EUR 4.5 million. Discontinued operations The Power Sentry division was divested in the summer of 2006 and is reported under discontinued operations. The gain from the sale and the division's net operating profit for the corresponding period last year is reported as a separate item under discontinued operations. Formulas for calculation of key ratios The key ratios presented in the interim reports have been calculated using the same formulas as the corresponding ratios in the latest financial statements. The formulas for calculation of ratios are available on page 36 of the Annual Report. As of January 1, 2007, Fiskars has applied the following new or amended IFRS standards: IFRS 7 Financial Instruments: Disclosures. IFRS 7 requires additional disclosures about the influence of financial instruments on the entity's financial situation and results. Implementation will mainly influence future Notes to the Consolidated Financial Statements and does not have any significant impact on the interim report. Amendment to the IAS 1 standard: Presentation of Financial Statements - Capital Disclosures. Implementation of the amendment will mainly influence future Notes to the Consolidated Financial Statements and does not have any significant impact on the interim report. IFRIC 9 Reassessment of Embedded Derivatives. The Corporation estimates that this interpretation will not influence its consolidated financial statements or the interim report, as no company within the Corporation has changed contract stipulations as indicated by the interpretation. IFRIC 10 Interim Financial Reporting and Impairment. IFRIC 10 states that an entity shall not reverse an impairment loss recognized in a previous interim period in respect of goodwill or an investment in either an equity instrument or a financial asset carried at cost. The Corporation estimates that this interpretation will not influence its consolidated financial statements or its interim report. CONSOLIDATED INCOME STATEMENT 7-9 7-9 chg 1-9 1-9 chg 1-12 2007 2006 % 2007 2006 % 2006 MEUR MEUR MEUR MEUR MEUR NET SALES 148.3 119.4 24 465.7 409.8 14 534.9 Cost of goods sold -96.9 -85.0 14 -309.8 -289.1 7 -376.8 GROSS PROFIT 51.4 34.4 49 155.9 120.7 29 158.1 Other operating income 1.3 0.6 111 2.1 2.1 -1 1.3 Sales and marketing expenses -23.0 -16.5 39 -63.8 -52.9 21 -71.9 Administration expenses -12.6 -9.9 27 -38.0 -34.1 12 -45.3 Research and development costs -1.6 -1.5 10 -4.6 -4.3 7 -6.1 Other operating expenses 1.3 -1.1 0.7 -6.6 -9.0 Income from associate 11.1 6.9 60 26.6 40.8 -35 58.6 OPERATING PROFIT 27.8 13.0 115 78.8 65.8 20 85.8 Gain on sale of Wärtsilä shares 16.8 16.8 Financial income 0.9 0.2 2.7 0.8 1.8 Financial expenses -4.0 -2.6 58 -9.8 -8.4 17 -10.9 PROFIT BEFORE TAXES 41.4 10.6 289 88.4 58.1 52 76.7 Income taxes -3.2 -2.7 18 -10.3 -0.5 -9.8 PROFIT FROM CONTINUING OPERATIO 38.2 7.9 382 78.1 57.6 35 66.9 Profit from discontinued oper. 1.8 14.9 15.2 PROFIT (LOSS) FOR THE PERIOD 38.2 9.8 292 78.1 72.5 8 82.0 Minority share 0.0 0.0 0.0 0.0 0.0 PROFIT FOR ORDINARY SHAREHOLDER 38.2 9.8 291 78.1 72.5 8 82.0 Earnings for ordinary shareholders per share, euro 0.49 0.13 1.01 0.94 1.06 continuing operations 0.49 0.10 1.01 0.74 0.86 discontinued operations 0.02 0.19 0.20 Earnings per share is undiluted. The company has no open option programs or other earnings diluting financial instruments. CURRENCY RATES 1-9 1-9 chg 1-12 2007 2006 % 2006 USD average rate (I/S) 1.34 1.24 8 1.26 USD end-of-period (B/S) 1.42 1.27 12 1.32 CONSOLIDATED BALANCE SHEET 9/07 9/06 chg 12/06 MEUR MEUR % MEUR ASSETS NON-CURRENT ASSETS Intangible assets 137.9 20.0 589 19.2 Goodwill 100.8 22.1 356 22.4 Tangible assets 122.8 104.3 18 98.7 Biological assets 45.6 32.8 39 35.0 Investment property 8.4 9.0 -6 8.7 Investment in associate 256.5 241.4 6 239.1 Other shares 3.3 4.8 -31 5.0 Other investments 2.5 1.5 72 1.5 Other long-term tax receivables 1.6 7.6 -79 5.5 Deferred tax assets 24.3 30.7 -21 24.9 NON-CURRENT ASSETS TOTAL 703.7 474.1 48 460.0 CURRENT ASSETS TOTAL Inventories 186.4 112.8 65 114.6 Trade receivables 117.6 90.8 29 82.7 Other receivables 10.7 2.4 338 5.0 Cash in hand and at bank 9.4 43.6 -78 44.9 CURRENT ASSETS TOTAL 324.2 249.7 30 247.2 ASSETS TOTAL 1027.9 723.8 42 707.2 EQUITY AND LIABILITIES EQUITY 453.7 431.8 5 421.8 NON-CURRENT LIABILITIES Interest bearing debt 132.8 125.6 6 120.7 Non-interest bearing debt 2.0 2.6 -26 2.6 Deferred tax liabilities 54.7 21.1 159 20.8 Pension liability 12.7 14.8 -14 12.8 Provisions 5.4 5.0 7 4.2 NON-CURRENT LIABILITIES TOTAL 207.5 169.1 23 161.1 CURRENT LIABILITIES Interest bearing debt 222.3 23.4 848 26.1 Trade payable and other non-interest bearing debt 136.6 93.6 46 92.6 Income tax payable 7.8 5.8 33 5.7 CURRENT LIABILITIES TOTAL 366.7 122.9 198 124.4 EQUITY AND LIABILITIES TOTAL 1027.9 723.8 42 707.2 CONSOLIDATED STATEMENT 1-9 1-9 1-12 OF CASH FLOWS 2007 2006 2006 MEUR MEUR MEUR CASH FLOWS FROM OPERATING ACTIVITIES Net profit before taxes 88.4 58.1 76.7 Adjustments for Depreciation 16.1 18.6 28.6 Income from associate -26.6 -40.8 -58.6 Investment income -18.4 -0.3 -0.8 Interest expense 8.8 7.9 9.9 Chg in value of biological assets -10.7 -2.9 -5.0 Cash generated before working capital 57.7 40.7 50.8 Change in working capital Change in interest free assets -12.1 -9.2 -5.4 Change in inventories -15.6 12.3 7.6 Change in interest free liabilities 6.9 9.9 7.6 Cash generated before financing and ta 36.9 53.7 60.6 Dividends from associate 27.7 23.7 47.5 Dividends received, other 0.1 3.6 3.6 Financial costs paid (net) -6.1 -6.5 -7.4 Taxes paid -6.5 -2.5 -5.1 NET CASH FROM OPERATING ACTIVITIES A 52.1 72.0 99.0 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions -240.7 -25.5 -26.0 Net change in shares in associate -0.1 Capital expenditure -12.9 -12.2 -19.3 Proceeds from sale of fixed assets 0.2 2.5 5.4 Sale of other l/t investments 3.2 1.8 2.2 Purchase of other l/t investments -5.2 -5.3 Cash flow from discontinued operations 32.9 33.0 NET CASH USED IN INVESTING ACTIVITIES -250.3 -5.8 -10.1 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from l/t borrowings 14.3 15.0 Repayment of l/t borrowings -0.5 -3.1 -4.6 Proceeds from (payment) of) s/t borrow 209.6 -22.7 -21.4 Payment of financial leases liabilitie -2.2 -2.2 -2.8 Cash flows from other financing items -1.1 0.1 0.1 Dividends paid -46.0 -34.4 -57.1 NET CASH USED IN FINANCING ACTIVITIES 159.8 -48.0 -70.8 CHANGE IN CASH (A+B+C) -38.4 18.3 18.2 Cash at beginning of period 44.9 21.7 21.7 Translation difference 2.9 3.6 5.0 Cash at end of period 9.4 43.6 44.9 STATEMENT OF CHANGES IN Equity holders of the parent companMinorit Total SHAREHOLDERS' EQUITY Other interest Share Own reser-Transl.Retain. capital shares vesadjustm earn. MEUR MEUR MEUR MEUR MEUR MEUR MEUR Dec 31, 2005 77.5 -0.9 24.7 1.2 300.3 0.0 402.7 Translation differences -1.4 -1.4 Change in fair value reserve, associate -7.4 -7.4 Other changes in associate -0.2 0.0 -0.2 NET INCOME RECOGNISED DIRECTLY IN EQUITY -7.4 -1.7 0.0 0.0 -9.1 Net profit for the period 72.5 0.0 72.5 TOTAL RECOGNISED INCOME AND EXPENSE FOR THE PERIOD -7.4 -1.7 72.5 0.0 63.5 Dividend distribution -34.4 -34.4 Sep 30, 2006 77.5 -0.9 17.3 -0.5 338.4 0.0 431.8 Translation differences -0.6 -0.6 Change in fair value reserve, associate 4.3 4.3 Other changes in associate -0.4 -0.1 -0.5 Other changes 0.0 0.0 NET INCOME RECOGNISED DIRECTLY IN EQUITY 4.3 -1.0 -0.1 0.0 3.2 Net profit for the period 9.5 0.0 9.5 TOTAL RECOGNISED INCOME AND EXPENSE FOR THE PERIOD 4.3 -1.0 9.4 0.0 12.7 Dividend distribution -22.8 -22.8 Dec 31, 2006 77.5 -0.9 21.6 -1.5 325.0 0.0 421.8 Translation differences -6.2 -6.2 Change in fair value reserve, associate 1.5 1.5 Other changes in associate -0.2 -0.2 Equity net investment hedges 4.5 4.5 Other changes 0.1 0.1 NET INCOME RECOGNISED DIRECTLY IN EQUITY 6.0 -6.3 0.0 0.1 -0.2 Net profit for the period 78.1 0.0 78.1 TOTAL RECOGNISED INCOME AND EXPENSE FOR THE PERIOD 6.0 -6.3 78.1 0.2 77.9 Dividend distribution -46.0 -46.0 Sep 30, 2007 77.5 -0.9 27.5 -7.8 357.1 0.2 453.7 KEY FIGURES 9/07 9/06 chg 12/06 % Equity/share, euro 5.86 5.58 5 5.45 Equity ratio 44% 60% 60% Net gearing 76% 24% 24% Equity, meur 453.7 431.8 5 421.8 Net interest bear.debt, meur 345.7 105.4 228 101.9 Average number of employees 3279 3200 2 3167 Number of employees eop 4484 3195 40 3003 SEGMENT INFORMATION 7-9 7-9 chg 1-9 1-9 chg 1-12 NET SALES 2007 2006 % 2007 2006 % 2006 MEUR MEUR MEUR MEUR MEUR Fiskars Brands 121.0 110.5 10 403.6 376.9 7 489.9 Iittala 16.0 16.0 Inha Works 5.5 5.6 0 33.3 28.1 19 37.2 Real Estate 6.5 3.9 66 14.6 6.7 117 10.3 Unallocated and eliminations -0.7 -0.5 37 -1.7 -1.8 -9 -2.4 CORPORATE TOTAL 148.3 119.4 24 465.7 409.8 14 534.9 Export from Finland 14.1 10.0 41 52.7 43.2 22 58.9 SEGMENT INFORMATION 7-9 7-9 1-9 1-9 1-12 OPERATING PROFIT 2007 2006 2007 2006 2006 MEUR MEUR MEUR MEUR MEUR Fiskars Brands 12.1 3.3 41.9 21.1 21.1 Iittala 0.3 0.3 Inha Works -0.2 0.2 3.4 2.9 3.7 Real Estate 5.4 3.2 11.4 5.2 7.6 Associate Wärtsilä 11.1 6.9 26.6 40.8 58.6 Unallocated and eliminations -0.8 -0.7 -4.7 -4.2 -5.2 CORPORATE TOTAL 27.8 13.0 78.8 65.8 85.8 SEGMENT INFORMATION 7-9 7-9 1-9 1-9 1-12 DEPRECIATIONS 2007 2006 2007 2006 2006 MEUR MEUR MEUR MEUR MEUR Fiskars Brands 4.3 5.4 13.2 16.6 25.8 Iittala 0.6 0.6 Inha Works 0.4 0.3 1.0 0.9 1.2 Real Estate 0.4 0.3 1.1 1.0 1.4 Unallocated and eliminations 0.1 0.0 0.2 0.1 0.1 CORPORATE TOTAL 5.7 6.0 16.1 18.6 28.6 SEGMENT INFORMATION 7-9 7-9 1-9 1-9 1-12 CAPITAL EXPENDITURE 2007 2006 2007 2006 2006 MEUR MEUR MEUR MEUR MEUR Fiskars Brands 2.5 26.4 22.0 32.4 37.5 Iittala *) 228.4 228.4 Inha Works 1.0 0.0 2.6 0.6 1.2 Real Estate 0.7 0.2 1.3 1.5 1.9 Associate Wärtsilä 20.7 20.7 Unallocated and eliminations 0.9 1.2 0.0 0.3 CORPORATE TOTAL 254.1 26.6 276.2 34.5 40.8 *) The Group's investment in the segment is included here GEOGRAPHICAL SEGMENT 7-9 7-9 chg 1-9 1-9 chg 1-12 NET SALES BASED ON CUSTOMER 2007 2006 % 2007 2006 % 2006 LOCATION MEUR MEUR MEUR MEUR MEUR Europe 79.2 52.1 52 256.4 192.5 33 257.1 USA 59.2 58.1 2 180.0 185.4 -3 235.2 Rest of the world 10.0 9.3 7 29.3 31.9 -8 42.6 CORPORATE TOTAL 148.3 119.4 24 465.7 409.8 14 534.9 Short delivery times are a prerequisite in Fiskars' fields of operations. Therefore, the backlog of orders and changes in it are not of significant importance. IMPACT OF ACQUISITIONS ON THE CONSOLIDATED BALANCE SHEET MEUR Fiskars acquired Iittala Group Plc. on August 31. Iittala designs, produces and sells homeware, its home markets are Finland, Sweden and Norway and in addition Iittala has sales companies in United States, Denmark, Estonia, The Netherlands, Germany and Poland. Iittala's net sales in 2006 were EUR 189.8 million, operating profit was EUR 17.0 million and net profit was EUR 7.4 million. Total assets were EUR 160.5 million and personnel 1 353 at the end of 2006. Iittala forms a new segment within Fiskars and the consolidated net sales for the review period was EUR 16.0 million and the operating profit before eliminations from purchase price allocation was EUR 1.4 million. Iittala and Fiskars have not had any business relations before the acquisition. If Iittala had been consolidated from the beginning of the year the proforma consolidated net sales and operating profit for Fiskars would have been EUR 579 million and EUR 84 million respectively. Purchase price has been allocated to the intangible assets in Iittala, valuation of the trademarks was based on their qualities and significance. Customer relationships and franchising business have also been included in immaterial assets. Trademarks are not depreciated annually as no economical lifetime can be established. Customer relationships and franchising business related assets are depreciated during their estimated economical lifetime of 15 years. Additionally part of the purchase price was allocated to inventory, this will be realized during 2007. The goodwill from the acquisition relates mostly to the synergies that will be gained from integrating the businesses. IITTALA ACQUISITION COST, PRELIMINARY SPECIFICATION MEUR Purchase price paid in cash 115.6 Acquisition related costs 1.7 Capital loans from previous owners included in the transact 44.7 Fair value of acquired assets 90.1 Minority share 0.1 GOODWILL 72.0 sellers book fair ACQUIRED ASSETS AND LIABILITIES values values Fixed non-current assets 26.0 26.0 Intangible and other immaterial non-current assets 3.8 118.9 Inventories 56.7 60.6 Receivables 19.6 19.6 Cash and bank 6.3 6.3 Deferred tax liability -1.2 -32.1 Capital loans -44.7 0.0 Non-current liabilities -8.9 -8.9 Current liabilities -100.3 -100.3 TOTAL -42.6 90.1 IMPACT OF ACQUISITIONS ON THE CONSOLIDATED BALANCE SHEET MEUR Fiskars acquired the French company Leborgne S.A. in May. The company produces garden tools in France and in addition to the French market sells them in Spain, Belgium and Italy. The net sales for Leborgne in 2006 was EUR 16 million. The purchase price has been allocated to trademark Leborgne, customer relationships and inventory. The remaining goodwill relates to synergies within the garden business in Europe and the acquired product program. LEBORGNE ACQUISITION COST, PRELIMINARY SPECIFICATION Purchase price paid in cash 12.8 Acquisition related costs 0.4 Fair value of acquired assets 6.5 GOODWILL 6.7 sellers book fair ACQUIRED ASSETS AND LIABILITIES values values Non-current assets 0.9 3.2 Inventories 3.2 3.3 Receivables 6.1 6.1 Cash and bank 0.1 0.1 Deferred tax liability 0.0 -0.8 Non-current liabilities -0.9 -0.9 Current liabilities -4.5 -4.5 TOTAL 4.9 6.5 CONTINGENCIES AND PLEDGED ASSETS 9/07 9/06 12/06 MEUR MEUR MEUR AS SECURITY FOR OWN COMMITMENTS Discounted bills of exchange 0 0 Lease commitments 60 20 19 Other contingencies 7 9 9 TOTAL 67 29 28 GUARANTEES AS SECURITY FOR THIRD-PARTY COMMITMENTS Real estate mortgages 2 2 2 TOTAL PLEDGED ASSETS AND CONTINGENCIES 68 31 30 Iittala Group has long-term lease commitments for several facilities in Finland and abroad. NOMINAL AMOUNTS OF DERIVATIVES Forward exchange contracts 56 46 94 Interest rate swaps 16 Forward interest rate agreements 75 Electricity forward agreements 1 MARKET VALUE VS. NOMINAL AMOUNTS OF DERIVATIVES Forward exchange contracts 0 0 0 Interest rate swaps 0 Forward interest rate agreements 0 Electricity forward agreements 0 Forward exchange contracts have been valued at market in the financial statements. RELATED PARTY TRANSACTIONS The foundation of Bergsrådinnan Sophie von Julins stiftelse had a deposit totaling EUR 0.1 million (1.3) in the Financial Services Office on September, 30 2007. An interest of base rate + 0.5 was paid on the deposit. Fiskars Corporation has in total booked legal fee invoices from Foley & Lardner for which Ralf Böer is an associate, for EUR 1.1 million
Press and stock exchange releases from Fiskars Corporation, dating from 1997 have been gathered onto this page. Additional financial data related to interim reports and the annual reports stock exchange releases can be retrieved from 2000 onwards.