Martela Oyj - Interim report (Q1 and Q3)

MARTELA CORPORATION INTERIM REPORT 1 JANUARY – 30 SEPTEMBER 2017

The January-September 2017 revenue and operating result declined from the comparison period. The third quarter operating result was EUR 1.7 million.  

Challenges related to the implementation of the new IT systems made it difficult to retain the profitability and delivery accuracy reached in the previous year. Due to this we concentrated to stabilise the delivery accuracy on the third quarter and at the end of the quarter reached the 2016 level. Our operations have normalised and we estimate that we have overcome the biggest challenges related to the IT system project.  

July-September 2017

• Revenue was EUR 29.4 million (35.2), change -16.6 % 
• Operating result declined but was positive EUR 1.7 million (3.6)
• Operating result per revenue was 5.9 % (10.2 %)
• Result for the period declined but was positive EUR 1.5 million (2.7)
• Earnings per share amounted to EUR 0.37 (0.67)

January-September 2017

• Revenue was EUR 80.0  million (94.9), change -15,7 % 
• Operating result declined and was EUR 0.2 million (4.1)
• Operating result per revenue was 0.2 % (4,3 %)
• Result for the period declided and was EUR -0,4 million (2.6)
• Earnings per share amounted to EUR -0.09 (0.62)

Outlook for 2017 (published 23 October, 2017)

Martela Group anticipates that its 2017 revenue will decrease clearly and operating result will decrease compared to the previous year. Due to normal seasonal variations, the Group’s operating result accumulates mainly during the second half of the year. 

Key figures, EUR million  

	2017	2016	Change	2017	2016	Change	2016
	7-9	7-9	%	1-9	1-9	%	1-12
Revenue	29.4	35.2	-16.6	80.0	94.9	-15.7	129.1
Operating result	1.7	3.6	-52.1	0.2	4.1	-95.5	6.2
Operating result %	5.9	10.2		0.2	4.3		4.8
Result before taxes	1.6	3.5	-55.3	-0.1	3.6	-102.9	5.6
Result for the period	1.5	2.7	-44.5	-0.4	2.6	-113.8	3.3
Earnings/share, eur	0.37	0.67		-0.09	0.62		0.81
Return on investment %	19.0	42.6		1.2	16.0		18.2
Return on equity %	25.1	46.8		-1.9	14.5		13.9
Equity ratio %				41.2	46.3		45.3
Gearing %				30.2	-8.9		-18.9

  

Matti Rantaniemi, CEO:

”The January-September 2017 revenue and operating result declined from the comparison period. Challenges related to the implementation of the new IT systems made it difficult to retain the profitability and delivery accuracy reached in the previous year. Due to this we concentrated to stabilise the delivery accuracy on the third quarter and at the end of the quarter reached the 2016 level, supported by improvement of the functionalities of the IT system and implementation of the new procedures throughout the organization.

The whole Martela organization concentrated into implementing the IT systems and new procedures, resulting in revenue decline in almost all the markets. Biggest impact was into Finland revenue. However, on the third quarter the new orders started to pick up in Finland and exceeded the previous year level. 

Revenue decline in Sweden was in addition to IT system challenges due to lack of big projects and to the ongoing transformation of sales channel into Martela Lifecycle strategy format. In Norway our revenue increased accordingly to our strategy. Discontinuation of own sales operations in Poland and Russia has as expected declined our revenue in group Other countries.

Implementation of the comprehensive Martela Lifecycle in Nordics has developed well towards the strategic targets for the year 2018 of which one example is the Nordic contract with the construction and property group NCC.

The IT reforms caused somewhat more investments and expenditure than anticipated, but the effects from the earlier completed savings programme resulted in declined personnel and real estate expenditure. The third quarter cash flow from the operating activities was EUR 2.9 million positive, however the cash flow from the operating activities of January – September was negative by EUR 8.3 million (8.1).

In the remaining year we will focus on improving the sales volumes, profitability and cash flow as well as on finetuning the procedures by utilisating the new IT systems effectively. We will direct more resources into sales and into its back office in order to secure customer satisfaction. 

Our operations have normalised and we estimate that we have overcome the biggest challenges related to the IT system project as well as by the end of first quarter next year the IT systems will fully support our new strategy but still leading to some nonrecurring expenditure. “

Market 

No material changes took place in the market during the period. The demand for Martela’s products and services is fundamentally affected by the general economic situation and by the extent to which companies and the public sector need to use their space more efficiently and make their workplaces more effective management tools.

Revenue and operating result 

July-September 2017 revenue and operating result 

Revenue for July – September declined 16.6 % from the previous year and was EUR 29.4 million (35.2). Revenue declined in Finland by 9.4 % in Sweden by 50.1 %, and in Other countries by 37.9 %. Revenue grew in Norway by 18.7 %.

Operating result for third quarter was EUR 1.7 million (3.6). Result before taxes for July – September was EUR 1.6 million (3.5) and result for the period was EUR 1.5 million (2.7). 

January-September 2017 revenue and operating result  

Revenue for January – September was EUR 80.0 million (94.9) and declined by 15.7 % from the previous year. Revenue declined in Finland by 8.9 %, and in Sweden by 44.7 %. Revenue in Norway grew by 26.6 %. Revenue in group Other areas declined by 28.7 %.  

Operating result for January – September was EUR 0.2 million (4.1). Result before taxes for January – September was EUR -0.1 million (3.6) and result for the period was EUR -0.4 million (2.6).  

INFORMATION EVENT 

An event for analysts, portfolio managers and media will be held on Thursday 2 November 2017 from 11:30 to 12:30 at Martela house in address Takkatie 1, Helsinki. The result will be presented by CEO Matti Rantaniemi.

Martela Corporation Board of Directors 

Matti Rantaniemi CEO 

Further information 

CEO Matti Rantaniemi, tel +358 50 465 8194
CFO Riitta Järnstedt, tel +358 40 508 4993 

 

Distribution 

NASDAQ OMX Helsinki
Main news media
www.martela.com

Our strategic direction is defined by our mission “Better working” and our vision “People-centric workplaces”. Martela provides people centric workplaces where the users and their wellbeing are in the core. We focus on the Nordic countries, as the Nordic countries are forerunner in hybrid working environments with common open work culture background and needs.

 

 

 

 

 

Attachments:

2017_02112017_interimreport.pdf