Patria’s Financial Review for 2012
2012 was a year of profitable growth for Patria. There was a clear improvement in the company’s net sales and profitability.
The order stock accumulated over the previous years created a solid foundation for last year’s positive result, and almost all of the financial targets set for 2012 were achieved.
New orders and order stock in 2012
The value of new orders received during the 2012 financial year was EUR 432.4 million (EUR 456.3 million in 2011). Defence material and maintenance accounted for 85% (86%) and civilian products for 15% (14%) of new orders. At the end of December, the value of new orders received by the Group was EUR 1,229.9 million (EUR 1,626.5 million).
Several factors contributed to the company's improved profits. The Swedish order for Patria's AMV vehicles was taken into production and favourable development continued at Millog Oy. Also other businesses progressed as planned, such as the AMOS mortar project, the vehicle projects in Croatia and Poland; the Rauma class missile boat upgrade; the Hornet Mid Life Upgrade 2 (MLU2) programme; and cockpit and avionics upgrades to the Hawk Mk66 aircraft. Operations of Nammo AS, of which Patria owns 50%, also showed favourable development again. In 2012 Nammo’s net sales totalled EUR 443.7 million (EUR 407 million), and its profitability was good.
Net sales and profitability
Patria Group’s net sales for 2012 totalled EUR 736.1 million (EUR 618.4 million in 2011), up by 19%. Defence solutions and their maintenance accounted for 91% (90%) and civilian products for 9% (10%) of net sales, while 59% (63%) of net sales accrued from abroad.
The Group’s operating profit was EUR 87.0 million, representing 11.8% of net sales (2011: EUR 60.3 million, 9.7%). Consolidated income before taxes amounted to EUR 84.6 million (EUR 57.6 million), and the Group’s return on equity was 23.1% (17.7%).
The agreement signed with the Slovenian Ministry of Defence to close the vehicle delivery project was of importance to Patria. As a consequence of this agreement, significant risks related to the deliveries were eliminated.
Responsibility and transparency in operations
The company strengthened further responsibility and transparency in its operations, e.g. by developing its corporate responsibility operations and organisation, making its guidelines more specific, and adopting new methods to prevent any unethical behaviour. Furthermore, Patria published its first corporate responsibility report, prepared in accordance with the Finnish Government’s Decision in Principle.
As for the ongoing legal cases related to Patria’s three export projects, the proceedings continued at different speeds. The court of appeal process of the Egyptian case commenced, the charges for the Slovenian case were pressed and the pre-trial investigation of the Croatia case is still continuing.
Outlook
Based on previously received orders, the Group’s net sales for 2013 are estimated to grow compared to year 2012. However, due to structural changes in the order base, profitability is estimated to decrease somewhat from year 2012. Overall, Patria’s operations will continue stable. Any turmoil in global economy affects Patria with delay, but the known reduction of the domestic market military spending and the ongoing reform of the Finnish Defence Forces will urge Patria to contemplate possible realignment of its operations sometime in the future.
The Annual Review for 2012 is available after the annual general meeting of Patria Oyj on 24 April 2013 on Patria’s website www.patria.fi.
For further information, please contact:
Birgitta Selonen, Vice President, Corporate Communications, tel. +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%).
www.patria.fi
