Management report
In 2023 AS Linda Nektar (The Company's) unaudited turnover was EUR 2.49m, aligning within the range of updated management guidance of EUR 2.45 - 2.5m announced by the Company on 5 December 2023. Net profitability came in with a loss of EUR 0.13m. This largely reflects a period of consciously-reduced throughput (volumes) and the associated level of fixed costs impacting expenses. Management's reasoning of doing this relates to the strategy of not pursuing volume of certain products at any cost, particularly if there is a perceived risk of a negative operating result due to high volatility of variable costs. At the same time, increased throughput those products at zero or negative profitability unnecessarily decreases the operational efficiency of equipment in the longer term.
Sales activity outside of the Baltic region and Finland have been expanded further via an ongoing diversification strategy (including outside of the EU). Any scaling activity (significantly increased volumes) is dependent on the clients concerned deciding to move ahead with the launch of particular products in various jurisdictions. This provides management sound argumentation to retain sufficient operational capacity for such events even if their timing is somewhat demanding to predict. The aforementioned strategy is shored up by the Company's ability to retain positive operating cash flow as well as net cash balances (including debt).
The Company continues to invest in various sustainable practices such as the previously mentioned solar project to help enable its own efficiencies as well as providing customers with improved carbon footprint initiatives throughout the production and distribution chain.
Financial review
In 2023 AS Linda Nektar (The Company's) unaudited turnover was EUR 2,489,789 (12 months 2022: EUR 3,786,852). This marked a decrease of 34.3% year-on-year. The H2 2023 unaudited revenue decreased by 26.7% compared to H1 2023, amounted up to EUR 1,053,147 (H1 2023: EUR 1,436,642). The 12 months of 2023 ended in a net loss of EUR 130,660 (12 months 2022: net profit EUR 270,903).
As of 31 December 2023, the Company's total assets came to EUR 3,762,147 (31.12.2022: EUR 4,137,806) marking a decrease of 9.1% year-on-year. Current assets amounted to EUR 1,215,241 (31.12.2022: EUR 1,474,446) or 32.3% of total assets. Fixed assets amounted to EUR 2,546,906 (31.12.2022: EUR 2,663,360) or 67.7% of the balance sheet total. Cash and cash equivalents came to EUR 316,256 (31.12.2022: EUR 294,451). The Company retains its conservative financial leverage policy with a surplus net cash position after taking into account bank debt (see below for additional comments). Operating cash flow for the 12 months of 2023 was a positive EUR 342,762 (2022: EUR 552,831).
The liabilities of AS Linda Nektar totalled EUR 282,483 (31.12.2022: EUR 369,467) and equity amounted to EUR 3,479,664 (31.12.2022: EUR 3,768,339). In 2023, the Company signed a renewable energy loan agreement to fund the construction of the solar farm in Kobela. As of 31 December 2023, there were loan commitments of EUR 146,752 for investments.
A total of EUR 353,822 was invested into fixed assets (12 months 2022: EUR 821,626). Depreciation costs for the 12 months of 2023 amounted to EUR 353,883 (12 months 2022: EUR 435,004). Some investments will be implemented through support provided by the Agricultural Registers and Information Board (ARIB) as part of Rural Development Plan measure 4 'Investments into fixed assets'. The subsidy will be paid out if the investment is implemented no later than H2 2024. In 2023, the Company received partial grant in the amount of EUR 116,417. 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.
As of 31 December 2023, the Company had 15 employees, one Management Board Member, and four Supervisory Board Members. Labour costs for the 12 months of 2023 (including taxes) amounted to EUR 514,856 (12 months 2022: EUR 476,525).
In 2023, the Company paid EUR 158,014 in dividends (2022: EUR 158,014). The income tax cost on dividends was EUR 26,654 (12 months 2022: EUR 27,584).
Taking into account the present operating environment management is forecasting a conservative revenue guidance figure of EUR 2.5m, effectively reflecting a flat outcome compared with 2023.
Financial Ratios
| 2023 | 2022 | ||
| Current Ratio = Current Assets / Current Liabilities | x | 4.97 | 3.99 |
| Quick ratio = (Current Assets - Inventories) / Current Liabilities | x | 2.70 | 2.19 |
| Working Capital = Current Assets - Current Liabilities | 970 613 | 1 104 979 | |
| Equity Ratio = Total Equity / Total Assets*100 | % | 92.49 | 91.07 |
| Net Profit Margin= Net Profit / Sales Revenue*100 | % | -5.25 | 7.15 |
| Debt to Assets= Total Liabilities / Total Assets | x | 0.08 | 0.09 |
Statement of financial position
(In Euros)
| 31.12.2023 | 30.06.2023 | 31.12.2022 | 30.06.2022 | |
| Assets | ||||
| Current assets | ||||
| Cash and cash equivalents | 316 256 | 319 198 | 294 451 | 694 213 |
| Receivables and prepayments | 343 528 | 496 448 | 515 099 | 675 334 |
| Inventories | 555 457 | 643 237 | 664 896 | 611 203 |
| Total current assets | 1 215 241 | 1 458 883 | 1 474 446 | 1 980 750 |
| Non-current assets | ||||
| Receivables and prepayments | 68 | 68 | 45 | 6 |
| Property, plant and equipment | 2 534 034 | 2 480 150 | 2 647 768 | 2 196 030 |
| Intangible assets | 12 804 | 16 391 | 15 547 | 5 055 |
| Total non-current assets | 2 546 906 | 2 496 609 | 2 663 360 | 2 201 091 |
| Total assets | 3 762 147 | 3 955 492 | 4 137 806 | 4 181 841 |
| Liabilities and equity | ||||
| Liabilities | ||||
| Current liabilities | ||||
| Loan liabilities | 108 897 | 25 000 | 0 | 0 |
| Payables and prepayments | 135 731 | 258 370 | 369 467 | 321 109 |
| Total current liabilities | 244 628 | 283 370 | 369 467 | 321 109 |
| Non-current liabilities | ||||
| Loan liabilities | 37 855 | 21 900 | 0 | 0 |
| Total non-current liabilities | 37 855 | 21 900 | 0 | 0 |
| Total liabilities | 282 483 | 305 270 | 369 467 | 321 109 |
| Equity | ||||
| Issued capital | 1 580 143 | 1 580 143 | 1 580 143 | 1 580 143 |
| Share premium | 617 517 | 617 517 | 617 517 | 617 517 |
| Statutory reserve capital | 93 629 | 93 629 | 80 084 | 80 084 |
| Retained earnings (loss) | 1 319 035 | 1 319 035 | 1 219 692 | 1 219 692 |
| Reporting period profit (loss) | -130 660 | 39 898 | 270 903 | 363 296 |
| Total equity | 3 479 664 | 3 650 222 | 3 768 339 | 3 860 732 |
| Total liabilities and equity | 3 762 147 | 3 955 492 | 4 137 806 | 4 181 841 |
Income statement
(In Euros)
| 2023 | 2023 H2 | 2022 | 2022 H2 | |
| Revenue | 2 489 789 | 1 053 147 | 3 786 852 | 1 603 948 |
| Other income | 0 | 0 | 13 824 | 13 824 |
| Changes in inventories of finished goods and work in progress | 14 068 | -21 557 | 224 182 | -12 849 |
| Raw materials and consumables used | -1 495 920 | -636 926 | -2 528 575 | -1 063 424 |
| Other operating expenses | -245 237 | -139 171 | -284 899 | -169 658 |
| Employee expenses | -514 856 | -254 813 | -476 525 | -254 875 |
| Depreciation and impairment loss (reversal) | -353 883 | -173 469 | -435 004 | -208 386 |
| Other expenses | -883 | -9 | -1 428 | -1 000 |
| Operating profit (loss) | -106 922 | -172 798 | 298 427 | -92 420 |
| Interest income | 3 952 | 3 276 | 60 | 27 |
| Interest expenses | -1 036 | -1 036 | 0 | 0 |
| Profit (loss) before tax | -104 006 | -170 558 | 298 487 | -92 393 |
| Income tax expense | -26 654 | 0 | -27 584 | 0 |
| Reporting period profit (loss) | -130 660 | -170 558 | 270 903 | -92 393 |
Statement of cash flows
(In Euros)
| 2023 | 2023 H2 | 2022 | 2022 H2 | |
| Cash flows from operating activities | ||||
| Operating profit (loss) | -106 922 | -172 798 | 298 427 | -92 420 |
| Adjustments | ||||
| Depreciation and impairment loss (reversal) | 353 883 | 173 469 | 435 004 | 208 386 |
| Other adjustments | 0 | 0 | -13 790 | -13 790 |
| Total adjustments | 353 883 | 173 469 | 421 214 | 194 596 |
| Changes in receivables and prepayments related to operating activities | 171 548 | 152 920 | 53 020 | 160 196 |
| Changes in inventories | 107 883 | 87 780 | -353 268 | -55 393 |
| Changes in payables and prepayments related to operating activities | -156 976 | -115 546 | 147 232 | -26 419 |
| Income tax refund (paid) | -26 654 | 0 | -27 584 | 0 |
| Proceeds from government grants | 0 | 0 | 13 790 | 13 790 |
| Total cash flows from operating activities | 342 762 | 125 825 | 552 831 | 194 350 |
| Cash flows from investing activities | ||||
| Purchase of property, plant and equipment and intangible assets | -429 028 | -230 859 | -751 561 | -594 139 |
| Proceeds from government grants | 116 417 | 0 | 0 | 0 |
| Interest received | 3 952 | 3 276 | 60 | 27 |
| Total cash flows from investing activities | -308 659 | -227 583 | -751 501 | -594 112 |
| Cash flows from financing activities | ||||
| Loans received | 166 000 | 119 100 | 0 | 0 |
| Repayments of loans received | -19 248 | -19 248 | 0 | 0 |
| Interest paid | -1 036 | -1 036 | 0 | 0 |
| Dividends paid | -158 014 | 0 | -158 014 | 0 |
| Total cash flows from financing activities | -12 298 | 98 816 | -158 014 | 0 |
| Total cash flows | 21 805 | -2 942 | -356 684 | -399 762 |
| Cash and cash equivalents at beginning of period | 294 451 | 319 198 | 651 135 | 694 213 |
| Change in cash and cash equivalents | 21 805 | -2 942 | -356 684 | -399 762 |
| Cash and cash equivalents at end of period | 316 256 | 316 256 | 294 451 | 294 451 |
Statement of changes in equity
(In Euros)
| Issued capital | Share premium | Statutory reserve capital | Retained earnings (loss) | Total | |
| 31.12.2021 | 1 580 143 | 617 517 | 73 948 | 1 383 842 | 3 655 450 |
| Reporting period profit (loss) | 0 | 0 | 0 | 363 296 | 363 296 |
| Declared dividends | 0 | 0 | 0 | -158 014 | -158 014 |
| Changes in reserves | 0 | 0 | 6 136 | -6 136 | 0 |
| 30.06.2022 | 1 580 143 | 617 517 | 80 084 | 1 582 988 | 3 860 732 |
| Reporting period profit (loss) | 0 | 0 | 0 | -92 393 | -92 393 |
| 31.12.2022 | 1 580 143 | 617 517 | 80 084 | 1 490 595 | 3 768 339 |
| Reporting period profit (loss) | 0 | 0 | 0 | 39 898 | 39 898 |
| Declared dividends | 0 | 0 | 0 | -158 014 | -158 014 |
| Changes in reserves | 0 | 0 | 13 545 | -13 546 | -1 |
| 30.06.2023 | 1 580 143 | 617 517 | 93 629 | 1 358 933 | 3 650 222 |
| Reporting period profit (loss) | 0 | 0 | 0 | -170 558 | -170 558 |
| 31.12.2023 | 1 580 143 | 617 517 | 93 629 | 1 188 375 | 3 479 664 |
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
