Incap Oyj: PRELIMINARY PRO FORMA FINANCIALS ON CONSOLIDATED INCAP-INISSION

Incap Corporation  
Stock Exchange Release                   20 August 2013 at 8.30 p.m.

PRELIMINARY PRO FORMA FINANCIALS ON CONSOLIDATED INCAP-INISSION

The Extraordinary General Meeting of Incap Corporation will on 21 August 2013 decide among others on the provisional transaction between Incap Corporation and Inission AB. For this purpose, Incap has prepared preliminary pro forma calculations on the consolidated Incap-Inission. The figures are unaudited and when combining them, eventual adjustments required by the IFRS standard have not been considered. Specific pro forma figures in accordance with IFRS will be disclosed in the prospect, which Incap will publish to get the new shares traded at the stock exchange approximately in September 2013.

PRO FORMA INCOME STATEMENT 
EUR’000,
unaudited
2012 FY 2012² Jan-Jun 2013 Jan-Jun 2013
Inission Incap Consolidated Inission Incap Consolidated
External sales 29 748,22 64 141,00 93 889,22 14 292,30 20 537,00 34 829,30
Change in
inventories of
finished goods
and WiP
-33,87 -643,00 -676,87 -762,32 -357,00 -1 119,32
Other operating
income
42,40 404,00 446,40 0,00 39,00 39,00
Raw materials
and consumables
used
16 417,46 44 315,00 60 732,46 6 426,55 12 729,00 19 155,55
Personnel
expenses
7 826,88 11 087,00 18 913,88 4 042,30 4 955,00 8 997,30
EBITDA 2 300,02 779,00 3 079,02 1 562,25 -993,00 569,25
Depreciation,
amortisation
and impairment
losses
184,63 1 459,00 1 643,63 73,83 855,00 928,83
Other operating expenses 3 212,39 7 721,00 10 933,39 1 498,88 3 528,00 5 026,88
EBIT 2 115,39 -680,00 1 435,39 1 488,42 -1 848,00 -359,58
Financial income
and expenses, net
37,98 -752,00 -714,02 -20,24 -1 034,00 -1 054,24
Income before
taxes and
XO items
2 153,37 -1 432,00 721,37 1 468,18 -2 882,00 -1 413,82
Non-recurring items
Extraordinary items 175,22 175,22 14,95 14,95
Haircuts on
loans, interest
and payables
related to
the re-financing of Incap
2 505,07 2 505,07
Transaction
commissions
-350,00 -350,00
Income before
appropriations
and taxes
2 328,58 723,07 3 051,66 1 483,13 -2 882,00 -1 398,87
Balance sheet
allocations
-65,57 -65,57 0,00
Profit before taxes 2 263,01 723,07 2 986,08 1 483,13 -2 882,00 -1 398,87
Income tax expense³ 113,03 -3 497,00 -3 383,97 -54,12 -176,00 -230,12
Result for the period4 2 376,04 -2 773,93 -397,89 1 429,01 -3 058,00 -1 628,99

   
Pro forma income statements are conducted based on the assumption that the transaction took place on 1 January 2012. Hence, the transaction commissions as well as the haircuts in loans, interests and payables are added as non-recurring items in the income statement for 2012.

The pro forma balance sheet is conducted based on the assumption that the transaction took place by 30 June 2013. Hence, the directed share issue, the debt conversions and the reductions in accounts payables are included in the company balance as of January-June 2013.

Key Financials FY 2012² Jan-Jun 2013
Inission Incap Consolidated Inission Incap Consolidated
Other operating income, % of sales 0,1 % 0,6 % 0,5 % 0,0 % 0,2 % 0,1 %
Materials and supplies, % of sales 55,2 % 69,1 % 64,7 % 45,0 % 62,0 % 55,0 %
Total cost of material, % of sales 55,3 % 70,1 % 65,4 % 50,3 % 63,7 % 58,2 %
Employee benefits expense, % of sales 26,3 % 17,3 % 20,1 % 28,3 % 24,1 % 25,8 %
Other operating expenses, % of sales 10,8 % 12,0 % 11,6 % 10,5 % 17,2 % 14,4 %
EBITDA margin, % 7,7 % 1,2 % 3,3 % 10,9 % -4,8 % 1,6 %
EBIT margin, % 7,1 % -1,1 % 1,5 % 10,4 % -9,0 % -1,0 %
EBAT margin, % 7,8 % 1,1 % 3,3 % 10,4 % -14,0 % -4,0 %
EBT margin, % 7,6 % 1,1 % 3,2 % 10,4 % -14,0 % -4,0 %
Profit margin, % 8,0 % -4,3 % -0,4 % 10,0 % -14,9 % -4,7 %


PRO FORMA BALANCE SHEET¹
EUR’000, unaudited Inission
30 June 2013
Incap
30 June 2013
Option to
combine
operations
Eliminations Consolidated
30 June 2013
Goodwill 0,00 905,00 4 720,72 5 625,72
Other intangible assets 2,18 64,00 66,18
Property, plant and equipment 436,42 2 093,00 2 529,42
Other financial assets 13,57 471,00 484,57
Shares in subsidiaries 8 072,92 -8 072,92 0,00
Deferred tax assets 432,28 356,00 788,28
Inventories 5 709,54 6 695,00 12 404,54
Lending to Inission AB 0,00 0,00
Trade and other receivables 5 155,59 9 705,00 14 860,59
Accrued income, prepaid expenses 122,24 0,00 122,24
Cash and cash equivalents 351,78 6 592,20 6 943,98
Total assets 12 223,602 26 881,20 8 072,92 -3 352,19 43 825,52
Share capital 412,84 25 008,20 8 072,92 -412,84 33 081,12
Restricted reserves 2 491,32 44,00 -2 491,32 44,00
Unrestricted reserves -5 090,96 5 182,00 5 090,96 5 182,00
Exchange differences 0,00 -1 111,00 0,00 -1 111,00
Retained earnings 4 109,92 -25 283,93 -4 109,92 -25 283,93
Result for the period 1 429,08 -3 058,00 -1 429,08 -3 058,00
Debt conversions 4 985,62 0,00 4 985,62
Total equity 3 352,19 5 766,89 8 072,92 -3 352,19 13 839,81
Provisions
Deferred tax liabilities 438,72 0,00 438,72
IB debt 3 678,33 12 093,57 15 771,90
Borrowing from Inission AB 924,12 924,12
Trade and other payables 2 227,40 9 019,73 11 247,13
Prepaid income, accrued charges 1 602,73 0,00 1 602,73
Total liabilities 8 871,29 21 113,31 29 984,60
Total equity and liabilities 12 223,49 26 880,20 8 072,92 -3 352,19 43 824,41
Minority interest 0,00 0,00 0,00

   

Key Financials Inission
30 June 2013
Incap
30 June2013
Consolidated
30 June 2013
Net working capital 7 157,25 7 380,27 14 537,51
Interest-bearing debt 5 041,17 12 093,57 17 134,74
Net debt 4 257,11 5 145,37 9 402,49
Equity ratio 27,42 % 21,45 % 31,58 %
Gearing 126,99 % 89,22 % 67,94 %

Notes:
1) In the pro forma statements Inission’s and Incap’s financial statements are consolidated assuming  that 100% of Incap is consolidated with Inission’s subsidiaries. Hence, parent company Inission AB is excluded
2) Fiscal year 2012 for Inission is based on a MM + Inission calendar year pro forma approach, were MM is assumed to have been owned the whole year. The P&L accounting entries for Inission vary between FY 2012 and Jan-Jun 2013, and the fiscal years may hence not be fully comparable.
3) Inission has reported no income tax expense for Jan-Jun 2013. The tax attributable to the subsidiaries stems from a difference in Munkfors’ profit in P&L and BS.
4) Profit before translation differences for Incap       
5) An average rate of SEK/EUR of 8,7041 is used for currency conversion in pro forma income statement as of 31.12.2012. The SEK/EUR rate at 1.7.2013 of 8,6958 is used for currency conversion in pro forma income statement and pro forma balance sheet as of 30.6.2012.
6) Incaps financials are calculated according to IFRS and Inission’s according to “Årsredovisningslagen och Bokföringsnämndens allmänna råd”

INCAP CORPORATION

Further information:
Sami Mykkänen, President and CEO, tel. +358 40 559 9047 or +372 555 379 05
Kirsti Parvi, CFO, tel. +358 50 517 4569 or +372 555 620 35
Hannele Pöllä, Director, Communications and IR, tel. +358 40 504 8296

DISTRIBUTION
NASDAQ OMX Helsinki Ltd
Principal media
www.incap.fi

INCAP IN BRIEF
Incap Corporation is an internationally operating contract manufacturer whose comprehensive services cover the entire life-cycle of electromechanical products from design and manufacture to maintenance services. Incap’s customers include leading equipment suppliers in energy efficiency and well-being technologies, for which the company produces competitiveness as a strategic partner. Incap has operations in Finland, Estonia, India and China. The Group’s revenue in 2012 amounted to EUR 64.1 million and the company currently employs approximately 600 people. Incap’s share is listed on the NASDAQ OMX Helsinki since 1997. Additional information: www.incap.fi.