Market situation
Demand has remained the same from the beginning of the year. No significant changes are expected in the near future.
The sustained maintenance and development of competitiveness has enabled Vaisala to retain its market share, and the company's market position is still strong.
Net sales and order book
The Vaisala Group's net sales for the review period were EUR 35.6 million (1-3/2004: EUR 36.8 million). Operations outside Finland accounted for 97 % (96 %) of net sales. The Group received new orders worth EUR 44.1 (41.2) million during the review period. The order book at the end of the review period was EUR 59.9 (60.0) million.
Vaisala Solutions
The Vaisala Solutions division generated net sales of EUR 9.2 (10.2) million.
Numerous tenders are made, particularly in the Aviation Weather business unit. However, the materialization of tenders in actual orders is still slow.
Vaisala Instruments
The Vaisala Instruments division generated net sales of EUR 11.9 (13.1) million.
Activity in the Japanese market has been reasonable. The European and North American markets have been slower. Price competition in the division's main market areas is intensifying.
Vaisala Measurement Systems
The Vaisala Measurement Systems division generated net sales of EUR 14.4 (13.6) million.
Projects postponed in 2004 increase the net sales of the review period for the former Vaisala Soundings division. The profitability of the former Vaisala Remote Sensing division has improved.
Performance
Operating profit for the review period was EUR 1.2 (2.6) million. Profit before extraordinary items was 7.2 % of net sales, or EUR 2.6 (1.9) million. Net profit for the review period was EUR 1.6 (1.5) million.
Financial income is mainly due to exchange rate changes.
Balance sheet
The Vaisala Group's solvency and liquidity remained strong. On March 31, 2005, the balance sheet total was EUR 163.0 (158.1) million. The Group's solvency ratio at the end of the review period was 76 % (80 %).
Research and development
Expenditure on research and development in the review period totaled EUR 5.0 (5.4) million, representing 14.0 % of the Group's net sales.
Capital expenditure
Gross capital expenditure in non-current assets totaled EUR 0.9 million (EUR 1.1 million).
Vaisala's share
The price of Vaisala's A share on the Helsinki Exchanges was EUR 18.20, December 31, 2004, and EUR 19.50 at the end of the review period. The highest share price quoted during the review period was EUR 20.99 and the lowest EUR 18.48.
Vaisala's share capital at the end of March was EUR 7,349,905.88 and the total number of shares was 17,479,000.
A total of 288,540 Vaisala shares were traded during the review period.
Personnel
The total number of employees in the Vaisala Group at the end of the review period was 1 052 compared with 1 100 at the end of the corresponding period in 2004.
Some 19 % (21 %) of the personnel worked in research and development. Approximately 35 % (37 %) of the Group's personnel worked outside Finland.
Vaisala Oyj's adoption of IFRS reporting
Vaisala Oyj has adopted the International Financial Reporting Standards (IFRS) in its Group reporting from the beginning of 2005. Interim figures for the year 2005 are reported according IAS/IFRS standards. A stock exchange release dated 8.4.2005 contains further information on this.
Outlook
The market outlook has not changed significantly. We expect slight growth in net sales in 2005, while the net profit is expected to be slightly lower than in the previous year.
The adoption of IFRS reporting should be taken into consideration when examining the profit of the review period. The effect, with tax adjustments, of the change in the treatment of defined-benefit disability pensions included in the balance sheet produced a one-off improvement in result of approximately EUR 2.5 million in the last quarter of 2004.
Vaisala aims to be the global market leader in its selected business areas also in the future. Therefore investments in product development and competitiveness will continue to be substantial.
Vantaa, Finland, May 3, 2005
Vaisala Oyj
Board of Directors
The full report including tables can be downloaded from the following link.
