Wulff-Yhtiöt Oyj - Financial Statement Release

WULFF GROUP PLC’S ANNUAL ACCOUNTS JAN 1 – DEC 31, 2016: Net sales and comparable operating profit declined, dividend remains at the same level

This is a summary of Wulff Group Plc’s annual accounts January 1 – December
2016. The annual accounts in full are attached to this stock exchange release.
The report is also available at the website www.wulff.fi.
WULFF GROUP: KEY POINTS JANUARY – DECEMBER 2016

  · In 2016, net sales totalled EUR 59.3 million (EUR 68.8 million). Net sales
decreased by -13.8 percent (-7.3 %).
  · In 2016, EBITDA was EUR 1.0 million (EUR 2.0 million). In 2016, EBITDA
included a sale of company cars of EUR 0.2 million affecting the comparability.
In 2015, EBITDA included write downs of inventories and fixed assets of EUR 0.2
million affecting the comparability.
  · In 2016, comparable EBITDA was EUR 0.8 million (EUR 2.2 million).
  · In 2016, the operating profit (EBIT) amounted to EUR 0.6 million (EUR 0.5
million). In 2016, EBIT included a sale of company cars of EUR 0.2 million
affecting the comparability. In 2015, EBIT included write downs of EUR 1.0
million regarding goodwill impairment and inventory and fixed assets write downs
affecting the comparability.
  · In 2016, the comparable operating profit (EBIT) amounted to EUR 0.4 million
(EUR 1.5 million).
  · Earnings per share (EPS) was EUR 0.05 (EUR -0.03) in 2016.
  · Equity-to-assets ratio increased to 50.5 percent (31.12.2015: 46.4 %).
  · Group CEO Topi Ruuska’s employment ended on September 2016. Wulff Group
Plc’s Board of Directors named CFO Elina Rahkonen as an interim CEO while the
recruiting process of a permanent CEO is going on.
  · The Board of Directors proposes to the Annual General Meeting to be held on
April 6, 2017 that a dividend of EUR 0.10 per share will be paid.
  · Wulff estimates the comparable operating profit to increase in 2017.

+----------------------+---------+---------+----------+----------+
|                      |1-12/2016|1-12/2015|10-12/2016|10-12/2015|
+----------------------+---------+---------+----------+----------+
|Net sales, EUR million|59,3     |68,8     |15,8      |18,6      |
+----------------------+---------+---------+----------+----------+
|EBITDA, EUR million   |1,0      |2,0      |0,3       |0,8       |
+----------------------+---------+---------+----------+----------+
|Comparable EBITDA, EUR|0,8      |2,2      |0,3       |0,8       |
|million               |         |         |          |          |
+----------------------+---------+---------+----------+----------+
|Operating profit      |0,6      |0,5      |0,2       |0,5       |
|(EBIT), EUR million   |         |         |          |          |
+----------------------+---------+---------+----------+----------+
|Comparable operating  |0,4      |1,5      |0,2       |0,7       |
|profit (EBIT), EUR    |         |         |          |          |
|million               |         |         |          |          |
+----------------------+---------+---------+----------+----------+
|EPS, EUR              |0,05     |-0,03    |0,04      |0,08      |
+----------------------+---------+---------+----------+----------+

WULFF GROUP’S CHAIRMAN OF THE BOARD OF DIRECTORS

Wulff Group’s Chairman of the Board of Directors:

In a constantly changing operating environment, it is more and more important
for companies to develop their operations in the desired direction rapidly
reacting. At Wulff, we are ready for change, renewal, and reform. I believe that
in the future we will be recognized for creating workplaces. We enable working
in environments where companies and entrepreneurs operate. Already, people work
a lot away from the traditional office environment. New working environments and
mobile work offer Wulff a possibility to grow in a novel market.

In 2016 we focused on our core business and ensuring its positive development in
the future. The development of our net sales and profitability was however less
successful than foreseen even though we managed to advance our business
activities as planned. In 2017, we will focus on growing together. That means we
will all strive to improve and grow personally and together as a company. And
above all, it means growth and development by increasing our competitive
advantage with our products and services to our customers. Brave renewal, hard
work, developing our operations in cooperation with our customers and global
economic recovery give us a solid starting point for a better result in 2017.

GROUP’S NET SALES AND RESULT PERFORMANCE

In 2016 net sales totalled EUR 59.3 million (EUR 68.8 million). Net sales
decreased by -13.8 percent (-7.3 %). The decrease in net sales without the
effect of sold businesses was -11.5 percent. In the last quarter net sales
totalled EUR 15.8 million (EUR 18.6 million) and decreased by -14.9 percent (
-9.2 %). The last quarter’s net sales decrease was -13.7 percent without the
effect of sold businesses. The good work in our customer interface and
investments in our sales’ development have not yet shown as expected in the
development of net sales. In Finland, the office supplies industry has begun to
show signs of stimulation.

In 2016, Wulff Group’s EBITDA was EUR 1.0 million (EUR 2.0 million) being 1.7
percent (2.9 %) of net sales. In 2016, EBITDA included a sale of company cars of
EUR 0.2 million affecting the comparability. In 2015, EBITDA included write
downs of inventories and fixed assets from business gifts business of EUR 0.2
million. In 2016, comparable EBITDA was EUR 0.8 million (EUR 2.2 million) being
1.4 percent (3.2 %) of net sales.

In the fourth quarter, Wulff Group’s EBITDA was EUR 0.3 million (EUR 0.8
million) being 1.9 percent (4.3 %) of net sales. EBITDA did not include items
affecting the comparability in 2016 and 2015.

In 2016, the operating profit (EBIT) amounted to EUR 0.6 (EUR 0.5 million) being
1.0 percent (0.7 %) of net sales. In 2016, EBIT included EUR 0.2 million of sale
of company cars affecting the comparability. In 2015, EBIT included a write of
goodwill, inventories and fixed assets of EUR 1.0 million affecting the
comparability. In 2016, the comparable operating profit was EUR 0.4 million (EUR
1.5 million) being 0.7 percent (2.2 %) of net sales. The comparable operating
profit declined by EUR 1.1 million, half of which was created during the first
half year period and half in the second half year period 2016. The development
of the comparable operating profit was affected by the drop in net sales and
investments in new customer acquisition. The Group will continue to invest in
sales development, new customer acquisition and improving the efficiency of the
business.

In the fourth quarter Wulff Group’s operating profit (EBIT) was EUR 0.2 million
(EUR 0.5 million) being 1.3 percent (2.8 %) of net sales. The 2016 fourth
quarter operating profit (EBIT) did not include items affecting the
comparability. The 2015 fourth quarter operating profit included impairment of
goodwill of EUR 0.1 million. In the fourth quarter the comparable operating
profit (EBIT) was EUR 0.2 million (EUR 0.7 million) being 1.3 percent (3.6 %) of
net sales. Typically in the industry and in the Group, the annual profit is made
in the last quarter of the year.

In 2016 Wulff Group’s employee benefit expenses amounted to EUR 12.6 million,
being 21.2 percent of net sales, and in 2015 EUR 13.5 million, being 19.6
percent of net sales. Employee benefit expenses amounted to EUR 3.2 million in
the fourth quarter 2016, being 20.1 percent of net sales, and EUR 3.6 million in
the fourth quarter 2015, being 19.3 percent of net sales. Other operating
expenses amounted to EUR 7.4 million in 2016, being 12.5 percent of net sales,
and EUR 8.0 million in 2015, being 11.7 percent of net sales. Other operating
expenses were EUR 1.9 million in fourth quarter 2016, being 12.1 percent of net
sales, and EUR 2.1 million in the fourth quarter 2015, being 11.1 percent of net
sales. Employee benefit and other operating expenses were affected by divesting
unprofitable businesses and improving efficiency of the operations. In 2017,
Wulff Group continues to examine its cost structure to improve its profitability
as part of ongoing reforms.

In 2016, the financial income and expenses totalled (net) EUR -0.2 million (EUR
-0.2 million) including interest expenses of EUR 0.2 million (EUR 0.2 million)
and mainly currency-related other financial items (net) EUR -0.0 million (EUR
-0.0 million). In the fourth quarter the financial income and expenses totalled
(net) EUR 0.0 million (EUR 0.0 million).

In 2016, the result before taxes was EUR 0.4 million (EUR 0.4 million). In 2015
the net profit after taxes was EUR 0.3 million (EUR -0.2 million). The net
profit after taxes was EUR 0.2 million (EUR 0.5 million) in the fourth quarter.

Wulff Group’s earnings per share (EPS) was EUR 0.05 (EUR -0.03) in 2016.
Earnings per share (EPS) was EUR 0.04 (EUR 0.08) in the fourth quarter.

KEY FIGURES

+-------------------------------------------+-----+-----+-----+-----------+
|                                           |IV   |IV   |I-IV |I-IV       |
+-------------------------------------------+-----+-----+-----+-----------+
|EUR 1000                                   |2016 |2015 |2016 |2015       |
+-------------------------------------------+-----+-----+-----+-----------+
|Net sales                                  |15   |18   |59   |68 820     |
|                                           |811  |585  |304  |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Change in net sales, %                     |-14,9|-9,2 |-13,8|-7,3 %     |
|                                           |%    |%    |%    |           |
+-------------------------------------------+-----+-----+-----+-----------+
|EBITDA                                     |308  |807  |998  |2 019      |
+-------------------------------------------+-----+-----+-----+-----------+
|EBITDA margin, %                           |1,9 %|4,3 %|1,7 %|2,9 %      |
+-------------------------------------------+-----+-----+-----+-----------+
|Operating profit/loss                      |207  |521  |583  |505        |
+-------------------------------------------+-----+-----+-----+-----------+
|Operating profit/loss margin, %            |1,3 %|2,8 %|1,0 %|0,7 %      |
+-------------------------------------------+-----+-----+-----+-----------+
|Profit/Loss before taxes                   |198  |558  |351  |354        |
+-------------------------------------------+-----+-----+-----+-----------+
|Profit/Loss   before taxes margin, %       |1,3 %|3,0 %|0,6 %|0,5 %      |
+-------------------------------------------+-----+-----+-----+-----------+
|Net   profit/loss for the period           |231  |520  |302  |-195       |
|attributable to equity holders of the      |     |     |     |           |
|parent   company                           |     |     |     |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Net   profit/loss for the period, %        |1,5 %|2,8 %|0,5 %|-0,3 %     |
+-------------------------------------------+-----+-----+-----+-----------+
|Earnings   per share, EUR (diluted = non   |0,04 |0,08 |0,05 |-0,03      |
|-diluted)                                  |     |     |     |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Return on equity (ROE), %                  |1,8 %|4,3 %|2,5 %|-1,6 %     |
+-------------------------------------------+-----+-----+-----+-----------+
|Return on investment (ROI), %              |1,6 %|3,4 %|2,9 %|2,7 %      |
+-------------------------------------------+-----+-----+-----+-----------+
|Equity-to-assets   ratio at the end of     |50,5 |46,4 |50,5 |46,4 %     |
|period, %                                  |%    |%    |%    |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Debt-to-equity   ratio at the end of period|19,6 |23,8 |19,6 |23,8 %     |
|                                           |%    |%    |%    |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Equity   per share at the end of period,   |1,78 |1,84 |1,78 |1,84       |
|EUR *                                      |     |     |     |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Net   cash flow from operating activities  |1 730|1 965|679  |1 693      |
+-------------------------------------------+-----+-----+-----+-----------+
|Investments   in non-current assets        |203  |3    |319  |161        |
+-------------------------------------------+-----+-----+-----+-----------+
|Investments   in non-current assets, % of  |1,3 %|0,0 %|0,5 %|0,2 %      |
|net sales                                  |     |     |     |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Treasury   shares held by the Group at the |79   |79   |79   |79 000     |
|end of period                              |000  |000  |000  |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Treasury   shares, % of total share capital|1,2 %|1,2 %|1,2 %|1,2 %      |
|and votes                                  |     |     |     |           |
+-------------------------------------------+-----+-----+-----+-----------+
|Number   of total issued shares at the end |6 607|6 607|6 607|6 607   628|
|of period                                  |  628|  628|  628|           |
+-------------------------------------------+-----+-----+-----+-----------+
|Personnel   on average during the period   |207  |229  |214  |233        |
+-------------------------------------------+-----+-----+-----+-----------+
|Personnel   at the end of period           |203  |226  |203  |226        |
+-------------------------------------------+-----+-----+-----+-----------+

* Equity attributable to the equity holders of the parent company / Number of
shares excluding the acquired own shares

RISKS AND UNCERTAINTIES IN THE NEAR FUTURE

The demand for office supplies is still affected by the organizations’ personnel
lay-offs and cost-saving initiatives made during the economic downturn. The
personnel lay-offs and cost-saving initiatives carried out in different
organizations during the economic downturn affect the purchasing behaviour of
our corporate customers. As economic uncertainty continues, the cost-saving
measures continue to affect the purchasing behaviour of our corporate customers.
The decreased amount of internationalization funding and the changes in the key
for granting it by the Ministry of Employment and The Economy affect the
companies’ chances to attend international fairs.

Half of the Group’s net sales come from other than euro-currency countries.
Fluctuation of the currencies affect the Group’s net result, however the effect
of the fluctuation is expected to be moderate.

EVENTS AFTER THE FINANCIAL YEAR

After the end of the financial year on 31.1.2017, the Group decided on a
financial arrangement that will see the available limit rise from 4.1 million
euros to 4.6 million euros and repayments of long-term debts decrease from 0.9
million euros to 0.5 million euros as the loan period increases in 2017. The
aforementioned agreement was signed and is binding in February 2017.

The Group has not had any other events after the financial year which would have
a material impact on 2016 financial statements.

BOARD OF DIRECTORS’ PROPOSAL FOR THE ANNUAL RESULT

The Group’s parent company Wulff Group Plc’s distributable funds totalled EUR
2.6 million. The Group’s net result attributable to the parent company
shareholders was EUR 0.3 million, i.e. EUR 0.05 per share (EUR -0.03 per share).
The Board of Directors proposes to the Annual General Meeting to be held on
April 6th, 2017 that a dividend of EUR 0.10 per share will be paid for the
financial year 2016 that is EUR 0.65 million and the remaining distributable
funds will be transferred in retained earnings in the shareholders’ equity.

MARKET SITUATION AND FUTURE OUTLOOK

Wulff is the most significant Nordic player in its field. Wulff’s mission is to
help its corporate customers to succeed in their own business by providing them
with leading-edge products and services in a way best suited to them. The Group
is prepared to carry out new strategic acquisitions and as a listed company
Wulff has a great opportunity to be a more active player than its competitors.

The possible economic recovery will affect Wulff’s business positively. Wulff
estimates the market situation to remain unchanged. Wulff’s goal is to continue
to improve the profitability of its business operations. Wulff estimates the
comparable operating profit for 2017 to increase. In the industry, it is typical
that the result and cash flow are generated in the last quarter.

WULFF GROUP PLC’S FINANCIAL REPORTING AND ANNUAL GENERAL MEETING 2017

Wulff Group Plc will release the following financial reports in 2017:

Statutory Financial Statements 2016     Week 11/2017
Interim Report, January-March 2017      Thursday May 4, 2017
Interim Report, January-June 2017       Thursday August 3, 2017
Interim Report, January-September 2017  Thursday November 2, 2017

Wulff Group Plc’s Annual General Meeting will be held on Thursday April 6, 2017.
A separate notice to the Annual General Meeting will be published prior to the
meeting.

In Helsinki on February 22, 2017

WULFF GROUP PLC

BOARD OF DIRECTORS

Further information:

Chairman of the Board of Directors Heikki Vienola

tel. +358 9 5259 0050 or mobile: +358 50 65 110

e-mail: heikki.vienola@wulff.fi

DISTRIBUTION

NASDAQ OMX Helsinki Oy

Key media

www.wulff-group.com

Attachments:

02228534.pdf