2006 Annual Report Contact Information TULIKIVI CORPORATION - TULIKIVI U.S., INC
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Annual Report Report Annual 2006 2006 TULIKIVI CORPORATION • ANNUAL REPORT 2006 ES 2021, 3/2007 www.tulikivi.com www.tulikivi.com FI-83900 Juuka, Finland, tel. +358 207 636 000, fax +358 207 636 130, +358 207 636 000, fax tel. Finland, FI-83900 Juuka, Tulikivi Corporation, Corporation, Tulikivi Contact Information TULIKIVI CORPORATION - TULIKIVI U.S., INC. ITALY SWITZERLAND FACTORIES AND OFFICES P.O. Box 7547 EUROTRIAS S.R.L. – GMBH ARMAKA AG HEAD OFFICE AND JUUKA FACTORIES Charlottesville, Via G. Di Vittorio 9 Duggingerstrasse 10 FI-83900 Juuka VA 22906-7547, USA I-39100 Bolzano/Bozen CH-4153 Reinach BL Tel. +358 207 636 000 Tel. +1 800 843 3473 Italy Switzerland Fax +358 207 636 130 Tel. +39 0 471 201 616 Tel. +41 61 715 9911 www.tulikivi.com TULIKIVI OYJ NIEDERLASSUNG Fax +39 0 471 201 689 Fax +41 61 715 9919 fi r s t n a m e . l a s t n a m e @ t u l i k i v i . fi DEUTSCHLAND Wernher-von-Braun-Str. 5 AUSTRIA USA SUOMUSSALMI FACTORY D-63263 Neu-Isenburg, Germany NEUHAUSER-SPECKSTEIN-ÖFEN TULIKIVI U.S., INC. Saarikyläntie 26 Tel. +49 6102 74 140 Bahnhofstrasse 54 P.O. Box 7547 FI-89920 Ruhtinansalmi Fax +49 6102 741 414 A-4810 Gmunden Charlottesville, Tel. +358 207 636 750 Austria VA 22906-7547 Fax +358 207 636 769 OOO TULIKIVI Tel. +43 7612 744 58 USA Liteiniy pr., 22 Fax +43 7612 744 584 Tel. +1 800 843 3473 TAIVASSALO AND VINKKILÄ FACTORIES 191028 St. Petersburg, Russia Helsingintie 108 Tel. +990 7 8129 512 655 LATVIA, LITHUANIA RUSSIA FI-23310 Taivassalo FI-83900 Juuka OOO TULIKIVI Tel. +358 207 636 880 ASSOCIATE COMPANIES Finland Liteiniy pr., 22 Fax +358 207 636 888 STONE POLE OY Tel. +358 207 636 000 191028 St. Petersburg Kuhnustantie 10 Fax +358 207 636 120 Russia HELSINKI OFFICE FI-83900 Juuka Tel. +990 7 8129 512 655 Bulevardi 22 Tel. +358 207 636 600 FRANCE FI-00120 Helsinki Fax + 358 207 636 609 TULIKIVI OYJ ESTONIA Tel. +358 207 636 000 75, avenue Parmentier Pihlaka 1 a Fax +358 207 636 558 LEPPÄVIRRAN MATKAILUKESKUS OY F-75011 Paris 11216 Tallinn Rasiahontie 3 France Estonia ESPOO OFFICE FI-79700 Heinävesi Tel. +33 1 40 21 25 65 Tel. +372 6555 486 Lautamiehentie 1 Tel. +358 207 636 501 Fax +33 1 40 21 24 00 Fax +372 6555 487 FI-02770 Espoo Fax +358 207 636 505 Tel. +358 207 636 820 SWEDEN Fax +358 207 636 877 SALES EXHIBITIONS IN FINLAND FI-83900 Juuka Nearest distributor on Internet site Finland SUBSIDIARIES www.tulikivi.com Tel. +358 207 636 000 KERMANSAVI OY Fax +358 207 636 120 Rasiahontie 3 TULIKIVI ABROAD FI-79700 Heinävesi BENELUX GERMANY Tel. +358 207 636 501 DUTRY & CO. TULIKIVI OYJ NIEDERLASSUNG Fax +358 207 636 505 Vichtestraat 147 DEUTCHLAND B-8540 Deerlijk Wernher-von-Braun-Str. 5 KIVIA OY Belgium D-63263 Neu-Isenburg Kivikatu 2-4 Tel. +32 56 776 090 Germany FI-88900 Kuhmo Fax +32 56 774 294 Tel. +49 6102 74 140 Tel. +358 207 636 700 Fax +49 6102 741 414 Fax +358 207 636 720 CONTACT INFORMATION 75 Contents Key Indicators 5 Mission, Vision, Values 6 Strategic Policies 6 Tulikivi’s Success Factors 7 Managing Director’s Review 8 Soapstone Fireplaces 10 Ceramic Products 10 Natural Stone Products 12 Product Development and Investments 13 Corporate Responsibility 14 Shareholder Policy 16 Board of Directors 18 Corporate Governance 20 Management Team 22 Information for Shareholders 24 Tulikivi Corporation’s Stock Exchange and Press Releases in 2006 25 Board of Directors’ Report and Financial Statements 28 Board of Directors’ Report 29 Consolidated Financial Statements, IFRS 33 Key Financial Ratios 62 Calculation of Key Ratios 64 Parent Company Financial Statements, FAS 64 Tulikivi Corporation’s Shareholders and Management Ownership 73 Signatures to Report of the Board and Financial Statements 74 Auditors’ Report 74 Contact Information 75 DEVELOPMENT OF NET SALES, MEUR The Year 2006 in Brief 90 82.1 80 A listed family company, Tulikivi Corporation and its 2006 2005 Change, 70 subsidiaries form the Tulikivi Group, the world’s largest % 58.6 60 55.3 52.5 53.6 manufacturer of heat-retaining fi replaces. The Group is Net Sales, MEUR 82.1 58.6 40.1 50 Operating profi t, MEUR 8.2 6.3 30.9 40 known for its Tulikivi soapstone fi replaces and natural 30 stone products as well as its Kermansavi ceramic fi re- Profi t before 7.8 6.1 28.6 20 places and utility ceramics. The Group’s revenue amounts income tax, MEUR 10 Return on to over EUR 80 million, about half of which is accounted 21.7 20.7 0 investments, % 2002 2003 2004 2005 2006 for by exports. The Group owns seven production plants and employs over 700 people. Solvency ratio, % 46.4 63.0 Earnings per share, www.tulikivi.com 0.16 0.12 29.8 EUR PROFIT BEFORE INCOME TAX, MEUR Equity per share, 0.83 0.70 18.0 8 7,8 KEY EVENTS EUR 7 • Fireplace product sales increased. 6,1* 6,1 Payment of dividend on 6 The Tulikivi Group’s sales rose by over 40 per cent. 5 A share, EUR 0.090 0.070 28.6 4,3 • Acquisition of Kermansavi Oy’s entire share capital. 4 3,3 K share, EUR 0.088 0.068 28.9 3 Expansion of product range and customer base. 2 • New generation of soapstone fi replaces launched. 1 • Brand renewal and a new look for marketing. Calculation of key ratios, page 64. 0 • Tulikivi awarded the 2006 Fine Particle 2002 2003 2004 2005 2006 The Tulikivi Group includes the parent company Tulikivi * Comparable operating profit in 2004, 5.0 MEUR Achievement of the Year by the Fine Particle Forum. Corporation, a branch offi ce Tulikivi Oyj Niederlassung • The merging of Kermansavi´s and Tulikivi’s fi replace NET CASH FLOW FROM OPERATING Deutschland as well as Kermansavi Oy, Kivia Oy, AWL distribution channels in Finland at the beginning ACTIVITIES, MEUR 12,0 Marmori Oy, Tulikivi U.S., Inc. and OOO Tulikivi. Other 12 of 2007. 10,5 Group companies are Tulikivi Vertrieb GmbH and The 10 • New production facility inaugurated in Juuka 8,2 Alberene Stone Company, Inc., which are no longer engaged 8 in November. 6,5 in business operations. The associate Companies of 6 • The Group’s profi t before taxes rose by 28.6 per cent. 5,3 Tulikivi Group are Stone Pole Oy and Leppävirran • Quadruple (split) increase in the number of 4 Matkailukeskus Oy. Tulikivi Corporation shares. 2 0 2002 2003 2004 2005 2006 INVESTMENTS AND SHARE PRICE OF THE A SHARE DEPRECIATION, MEUR DECEMBER 31, EUR RETURN ON INVESTMENTS, % 25 25 24.1 4,0 21,7 3,5 3,51 20,3 20,7 20 20 3,0 2,5 15 13,7 15 2,0 2,04 10,9 10 10 1,58 1,5 1,30 1,00 4.3 3.9 4.1 2.9 4.0 3.9 5.1 5.2 1,0 5 5 4.0 0,5 0 0 0,0 2002 2003 2004 2005 2006 2002 2003 2004 2005 2006 2002 2003 2004 2005 2006 Investments Depreciation KEY INDICATORS 5 Tulikivi’s Mission, Vision and Values Strategic Policies OUR MISSION Fair play is at the core of our operations. In practice, this • We achieve annual organic growth of over fi ve per Tulikivi Corporation brings warmth and comfort to your means being honest to yourself and making sure that cent. We also seek growth through acquisitions. home with high-quality branded products that sit well words are backed up by actions. with your interior decoration. Our business segments are • The target for return on investment is over 20 per the Soapstone Fireplaces, Ceramic Products and Natural TRENDS cent. We aim to improve relative profi tability by two Stone Products Businesses. We have identifi ed the following trends that support our percentage points per year. business and affect our success. We take environmental impacts into consideration in the • We are cementing the Tulikivi brand as the brand for design and manufacture of our products. Tulikivi seeks The price of energy continues to rise and the use of the whole Group. continuously to rack up good earnings, allowing investors bioenergy is increasing, as is uncertainty over energy to enjoy competitive dividends and increasing share distribution. The use of bioenergy in heating will increase • We expand systematically into new customer groups value, and allowing employees to rest assured that their in the future and society is supporting its use in a variety and markets, employing segmentation to boost jobs are secure. What’s more, their own earnings are of forms. Fireplaces are not affected by disturbances in marketing effectiveness. linked to the company’s fi nancial result. electricity distribution and therefore provide security. • We are further developing our leading, customer- OUR VISION Environmental protection is taking on growing importance focused product design, technology and service Tulikivi’s objective is to be the leading company specialized and emissions regulations are becoming stricter. The concept. in branded heating products and natural stone products products we sell pass the strictest emissions limits in for homes in selected market areas. As they evolve, we force in each of our territories. • We expand and improve our cooperation and will expand our operations into new product groups and distribution network. new markets. In construction, increasing attention is being paid to life cycle thinking and there is a growing appreciation of • We hone competitiveness by optimizing production OUR VALUES natural materials.