Patria Group Interim Report for 1 January – 30 June 2013
The Patria Group's result for the first half of the financial period corresponded to expectations. Net sales were EUR 362.7 million, compared to EUR 324.7 million in the previous year, which equals a growth of 11.7%.
Similarly, operating profit rose to EUR 27.5 million (7.9%) from EUR 23.8 million (7.3%) in 2012. The Group's equity ratio was 44.6% (42.6%). Net gearing was 20.6%, compared to 23.8% in 2012.
Net sales increased and operating profit improved during the review period
The Patria Group's result for the first half of the financial period corresponded to expectations. Net sales were EUR 362.7 million, compared to EUR 324.7 million in the previous year, which equals a growth of 11.7%. Similarly, operating profit rose to EUR 27.5 million (7.9%) from EUR 23.8 million (7.3%) in 2012. The Group's equity ratio was 44.6% (42.6%). Net gearing was 20.6%, compared to 23.8% in 2012.
The number of new orders remained at the previous year's level. The low order intake is illustrative of the market situation, both in Finland and internationally. Defence projects must frequently be sacrificed, as many potential customers are struggling with financial difficulties.
Early 2013
As part of the agreement signed in 2010, Patria delivered the first of the 113 Patria AMV armoured vehicles to the Swedish Defence Materiel Administration (FMV) in March 2013. The value of the project is approximately EUR 250 million.
In April 2013, the Kazakhstan Civil Aviation Academy and Patria Pilot Training signed a Memorandum of Understanding regarding professional pilot training cooperation.
In the spring, Patria signed an agreement with the Finnish Defence Forces regarding a research project related to the protection of data networks. The project is part of the Finnish Defence Forces' technology programmes and will take four years, including optional extensions.
In May, the Patria Group published a corporate responsibility progress report. The report is part of Patria's Annual Report, which has three parts: the actual Annual Report, the Financial Review and the Corporate Responsibility Progress Report. The entire Annual Report is available online at www.patria.fi.
Get Moving project, a three-year exercise project supported by Patria, is now in its final stages and has produced very favourable results. The project aims to promote a sports-oriented lifestyle among national service conscripts and thereby improve the quality of life of young people. During the project, the amount of exercise taken by conscripts in their free time has increased by over 25 %.
Court proceedings
In February, the District Court of Helsinki dismissed all charges related to the aviation accident that occurred in Taipalsaari in August 2008.
In May. preparatory hearings regarding the Slovenian vehicle project were begun in the District Court of Kanta-Häme. Court proceedings will start in August this year.
At the end of June, the Court of Appeal of Turku confirmed the decision given by the Pirkanmaa District Court and dismissed all charges of bribery related to the Egyptian export project (1998-2004). The state was ordered to compensate Patria for the legal costs incurred from hearings in the district court and court of appeal. Three former employees of Patria were convicted of accounting offences or of abetting such offences. The charge of abetting an accounting offence was dismissed for one person.
At the end of June, the Finnish Prosecution Service completed its consideration of charges in relation to Patria’s Croatian vehicle project, related to the pre-trial investigations initiated by Finland’s National Bureau of Investigation in 2008. The matter will proceed in the manner and according to the schedule decreed by the court.
Events after the review period
In July, Patria and NH Industries agreed on Patria's future Nordic Support Center role as part of the life-cycle support services for the NH90 helicopters assembled by Patria in Halli, located in the middle of Finland. Also in July, Patria, Poland's Ministry of the Economy and local manufacturer Wojskowe Zaklady Mechaniczne S.A. (WZM) agreed on continuing the manufacture of Patria vehicles under licence for the following ten years.
Outlook for the rest of the year
Thanks to significant orders received in previous years, operations will remain stable during the second half of 2013. Defence budget cuts in Finland and abroad will intensify competition for new projects, however. The fate of some very significant international projects, under preparation for a long time, will probably be determined by the end of the year. The growth of Patria's net sales will continue for the rest of 2013, and operating profit is also expected to remain at the current level for the rest of the financial period.
Further information
Birgitta Selonen, VP Corporate Communications, phone +358 40 869 2043, [email protected]
Patria is a trusted provider of defence, security and aviation life cycle support services and technology solutions. Patria is owned by the State of Finland (73.2%) and the European Aeronautic Defence and Space Company (EADS N.V.) (26.8%).
