Stockmann - Inside information

Stockmann Group's revised guidance for 2017 and outcome of impairment test

STOCKMANN plc, Inside Information 26.9.2017 at 8:30 EET

The Stockmann Group’s profit guidance for the year has been changed due to
weaker than estimated performance in Lindex’s business. Stockmann now expects
the Group’s adjusted operating profit in continuing operations to
be approximately on a par with or slightly weaker than in 2016.

The 2017 operating result for Stockmann Retail is estimated to improve, as the
turnaround of the business is progressing according to plan. Real Estate is
expected to continue its stable profitable performance. Lindex’s operating
profit in the first half of 2017 was clearly down on the previous year’s record
-high earnings. The sales development has improved in September, but forecast
for the fourth-quarter operating profit has been lowered.

Revised guidance for 2017:
Stockmann expects the Group’s revenue for 2017 to decline due to weaker sales
development of Lindex, changes in the store network and product mix. Adjusted
operating profit in continuing operations is expected to be approximately on a
par with or slightly weaker than in 2016.

Previous guidance for 2017 (published on 15 February 2017):
Stockmann expects the Group’s revenue for 2017 to decline due to changes in the
store network and product mix. Adjusted operating profit is expected to improve,
compared with 2016.

Impairment of approximately EUR 150 million in Lindex’s goodwill

Stockmann has concluded an impairment test for Lindex's and Retail’s
goodwill. As a result, Stockmann will recognise approximately EUR 150 million in
impairment related to Lindex’s goodwill in its third-quarter consolidated income
statement. The write-down will be reported as an adjustment, and it has no cash
flow impact.

According to IFRS, the Stockmann Group tests the goodwill of its assets
regularly to confirm that the recoverable amounts of the assets and related cash
-generating units are greater than their carrying values. The impairment tests
are done annually and whenever there is an indication that the asset may be
impaired.

Further information:

Lauri Veijalainen, CEO +358 9 121 5062
Kai Laitinen, CFO, tel. +358 9 121 5800

www.stockmanngroup.com

STOCKMANN plc
Lauri Veijalainen
CEO

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