Linda Nektar
Company Announcement

Interim Report for the six month period ended 30 June 2022 (unaudited)

Management report

In H1 2022 AS Linda Nektar (The Company´s) unaudited turnover was EUR 2,182,904 This marked an increase of 39.5% year-on-year (H1 2021: EUR 1,564,737). The first 6 months of 2022 generated a net profit of EUR 363,296 (H1 2021: EUR 100,391). The company’s performance was successfully secured through production and product portfolio adjustments together with cost-saving measures.

The segments of low and non-alcoholic beverages are considered to be one of the fastest growing areas in the industry and a constantly growing variety of taste profiles and ingredients. The development is driven by global mega trends where consumers are choosing healthier and naturally produced alternatives. Focusing on fermented ingredients for the beverage industry the Company provides tools and key components for the bottlers and their customers to meet this demand. As the growth in the low and non-alcoholic category has been eyed across the globe, it is prudent to note where the gains will be for the sector. Overall, there has been increased interest from both existing and new potential customers for new product development.

The Company’s operating environment has had limited exposure to the inflationary pressures of various commodity prices. Due to the war in Ukraine, costs have continued to increase significantly especially in raw materials, energy, fuel and freight. We have increased prices towards our customers during H1 2022 to mitigate the impact from higher costs. The Company has no direct impact from the Russia – Ukraine conflict (indirect impacts are seen in commodity and other input pricing volatility). However, business operations continue to involve some uncertainties due to raw material price increases, ongoing supply-chain disruptions and other inflationary impacts.

As of 30 June 2022, the Company’s total assets came to EUR 4,181,841 (30.06.2021: EUR 3,803,113) marking an increase of 10% year-on-year. Current assets amounted to EUR 1,980,750 (30.06.2021: EUR 1,614,703) or 47.4% of total assets. Fixed assets amounted to EUR 2,201,091 (30.06.2021: EUR 2,188,410) or 52.6% of the balance sheet total. The liabilities of AS Linda Nektar totalled EUR 321,109 (30.06.2021: EUR 169,987) and equity capital amounted to EUR 3,860,732 (30.06.2021: EUR 3,633,126).

As of 30 June 2022, there were no loan commitments, while cash and cash equivalents came to EUR 694,213 (30.06.2021: EUR 577,163). The Company retains its conservative financial leverage policy. Operating cash flow for the first 6 months of 2022 was a positive EUR 358,481 (H1 2021: EUR 211,887).

A total of EUR 151,010 was invested into fixed assets (H1 2021: EUR 243,181).  Some investments will be implemented through support provided by the Agricultural Registers and Information Board (ARIB).  In 2021 the Estonian Agricultural Registers and Information Board as part of Rural Development Plan measure 4.2.1 ‘Investment Support’ granted EUR 217,863.25 for the extension of fermentation capacity. The subsidy will be paid out if the investment is implemented no later than September 2023. Assets acquired with the help of government grants are recorded in the balance sheet at net acquisition cost, i.e., the acquisition cost, less government grants received for the purpose of acquiring assets.

Depreciation costs for the first 6 months of 2022 amounted to EUR 226,618 (H1 2021: EUR 201,888).

In H1 2022, the Company paid EUR 158,014 in dividends (H1 2021: EUR 158,014). The income tax cost on dividends was EUR 27,584 (H1 2021: EUR 28,514).

As of 30 June 2022, the Company had 13 employees, one Management Board Member, and four Supervisory Board Members. Labour costs for the first 6 months of 2022 (including taxes) amounted to EUR 221,650 (H1 2021: EUR 202,401).

Management’s guidance for revenues in 2022 remains at EUR 3.6m. This reflects ca. 16% year-on-year growth (incorporating both volume and pricing considerations).

Financial Ratios:

Statement of financial position

(In Euros)

Income statement

(In Euros)

Statement of cash flows

(In Euros)

Statement of changes in equity

(In Euros)

         Additional information:
         
         Kadri Rauba
         Member of Management Board
         AS Linda Nektar
         Address: Kobela, Antsla parish, 66407 Võrumaa, Estonia
         Telephone: +372 785 5768
         E-mail: info@lindanektar.ee