Reclassification of product management costs in Outotec's income statement
OUTOTEC OYJ STOCK EXCHANGE RELEASE APRIL 8, 2015 at 9.45 AM
RECLASSIFICATION OF PRODUCT MANAGEMENT COSTS IN OUTOTEC'S INCOME STATEMENT
In Outotec's income statement all costs related to technical product management have been included as of January 1, 2015, in Research and Development (R&D) expenses, and all costs related to commercial product management have been included in Selling and Marketing expenses. Previously some of the costs related to product management activities were reported in the Cost of Sales above the Gross Margin in the income statement.
Since 2011, Outotec has been developing and deploying uniform global business processes and related information technology platforms. The company has now established a more comprehensive technical product management process as part of its R&D, and a commercial product management process as part of its selling and marketing. The reclassification of product management costs is consistent with the redefinition of the product management business processes and reflects the true nature of these activities in the profit and loss statement.
When applying the reclassification to Outotec's 2014 income statement, EUR 19.6 million transfers from Cost of Sales to R&D expenses, and EUR 6.9 million to Selling and Marketing expenses.
Reclassification does not impact Outotec's sales, EBITA, EBIT or 2015 financial guidance.
Reclassified figures for 2014 (changes on bold in the table)
| Q1 | Q2 | Q3 | Q4 | Q1-Q4 | |
| EUR million | 2014 | 2014 | 2014 | 2014 | 2014 |
| Sales | 343.9 | 335.2 | 320.3 | 403.2 | 1,402.6 |
| Cost of sales | -269.2 | -263.8 | -238.3 | -310.7 | -1,082.1 |
| Gross profit | 74.7 | 71.4 | 82.0 | 92.5 | 320.5 |
| Gross profit, % | 21.7 | 21.3 | 25.6 | 22.9 | 22.9 |
| Other income | 0.2 | 0.5 | 0.1 | 0.8 | 1.6 |
| Selling and marketing expenses | -24.6 | -25.3 | -24.8 | -27.7 | -102.5 |
| Administrative expenses | -24.2 | -26.9 | -27.6 | -26.1 | -104.7 |
| Research and development expenses | -15.5 | -14.9 | -13.3 | -13.2 | -56.9 |
| Other expenses | -1.8 | -5.0 | -16.7 | -23.7 | -47.2 |
| Share of results of associated companies | - | -0.1 | 0.0 | -0.1 | -0.3 |
| EBIT | 8.7 | -0.3 | -0.3 | 2.3 | 10.4 |
| R&D expenses of sales, % | 4.1% |
| 2014 reported figures (before reclassification) | |||||
| Q1 | Q2 | Q3 | Q4 | Q1-Q4 | |
| EUR million | 2014 | 2014 | 2014 | 2014 | 2014 |
| Sales | 343.9 | 335.2 | 320.3 | 403.2 | 1,402.6 |
| Cost of sales | -276.9 | -270.6 | -245.4 | -315.7 | -1,108.6 |
| Gross profit | 67.0 | 64.6 | 74.9 | 87.5 | 294.0 |
| Gross profit, % | 19.5 | 19.3 | 23.4 | 21.7 | 21.0 |
| Other income | 0.2 | 0.5 | 0.1 | 0.8 | 1.6 |
| Selling and marketing expenses | -22.6 | -23.6 | -23.0 | -26.5 | -95.6 |
| Administrative expenses | -24.2 | -26.9 | -27.6 | -26.1 | -104.7 |
| Research and development expenses | -9.8 | -9.9 | -8.1 | -9.6 | -37.3 |
| Other expenses | -1.8 | -5.0 | -16.7 | -23.7 | -47.2 |
| Share of results of associated companies | - | -0.1 | 0.0 | -0.1 | -0.3 |
| EBIT | 8.7 | -0.3 | -0.3 | 2.3 | 10.4 |
| R&D expenses of sales, % | 2.7% | ||||
For further information please contact:
OUTOTEC
Mikko Puolakka, CFO
+359 20 529 2002
DISTRIBUTION:
Nasdaq Helsinki
Main media
www.outotec.com