2011-10-20 14:00:00 CEST
2011-10-20 14:00:03 CEST
REGULATED INFORMATION
Tulikivi Oyj - Interim report (Q1 and Q3)
Interim report January -September 2011
Tulikivi Corporation Interim report 20.10.2011 at 3.00
p.m.
Interim report January-September 2011
- The Tulikivi Group's third-quarter net sales were EUR 15.1 million (EUR 13.9
million, Q3/2010), the operating profit was EUR 0.5 (0.2) million and the
profit before taxes was EUR 0.3 (0.1) million.
- The Group's net sales during the reporting period were EUR 43.3 million (EUR
39.3 million, Jan-Sep 2010), the operating result was a loss of EUR -1.3 (-1.1)
million and the result before taxes a loss of EUR -1.9 (-1.6) million. The
operating result before expenses caused by concentration was a loss of EUR -0.7
(-1.1) million.
- Earnings per share amounted to EUR -0.04 (-0.03), and in the third quarter
EUR 0.00 (0.00).
- Cash flow from operating activities was EUR -1.5 (-1.0) million.
- Order books at the end of the period were at EUR 6.7 (the comparable order
books at Sept. 30, 2010 were 7.6) million.
- Despite the uncertainty caused by the economic crisis, the company's full
year like-for-like net sales will be up by slightly under 10 per cent, and the
operating profit before non-recurring items is expected to improve on the
previous year. The full-year operating result taking into account the
non-recurring expenses is expected to be negative, however, and at the same
level as the previous year.
Summary of the interim report 1-6/2011. The full interim report is attached to
this release.
Key financial ratios
1-9/ 1-9/ Change, 1-12/ 7-9 7-9/ Change,
2011 2010 % 2010 2011 2010 %
--------------------------------------------------------------
Sales, 43.3 39.3 10.3 55.9 15.1 13.9 9.1
MEUR
--------------------------------------------------------------
Operating -1.3 -1.1 -25.6 -0.3 0.5 0.2 143.3
profit/
loss,
MEUR
--------------------------------------------------------------
Profit -1.9 -1.6 -15.4 -1.0 0.3 0.1 309.9
before
tax,
MEUR
--------------------------------------------------------------
Total -1.4 -1.2 -19.3 -0.7 0.3 0.1 70.1
compre-
hensive
income
for the
period,
MEUR
--------------------------------------------------------------
Earnings -0.04 -0.03 -21.2 -0.02 0.00 0.00 139.9
per share/
Euro
--------------------------------------------------------------
Net cash -1.5 -1.0 2.9
flow from
operating
activities,
MEUR
--------------------------------------------------------------
Equity 33.3 36.9 37.0
ratio,
%
--------------------------------------------------------------
Net 101.0 82.9 68.1
indebt-
ness
ratio, %
--------------------------------------------------------------
Return -3.5 -2.5 -0.1 0.9 0.5
on invest-
ments,%
--------------------------------------------------------------
Managing Director's comments:
“Net sales in the third quarter grew in line with expectations. The strongest
growth was in fireplace sales in Finland and fireplace exports. Demand in
Finland is supported by the rising price of consumer energy and building
projects in progress. Nevertheless, the decline in consumer confidence caused
by the financial crisis will reduce demand for fireplaces compared with the
outlook at the beginning of the year.
The expansion of the distribution channel carried out in Finland and the new
fireplace and sauna products will support sales in the final part of the year.
In the sauna business, the focus is on expanding the product range and the
distribution channel.
In exports, growth was generated by the improved demand in the Baltic
countries, Sweden and Russia. The market situation for exports has weakened
since the summer. In Central Europe, consumers continue to be interested in
purchasing fireplaces, but the significant weakening of consumer confidence is
delaying purchasing decisions. The changed market situation is also likely to
be reflected in the demand for lining stone.
The plan to focus on core business areas announced in the spring has been
implemented. The loss-making product groups that did not belong to the core
business were discontinued, and the Heinävesi plant can now be made into a more
efficient fireplace factory. Concentrating kitchen countertop production in
Espoo will improve the profitability of the Natural Stone Products Business.
Measures to improve profitability will continue.”
Focusing on core businesses
The Group's core businesses are the manufacture of fireplaces and sauna and
interior stone products, development of product concepts and their marketing to
consumers. Tulikivi will discontinue the manufacture of utility ceramics by the
end of the year. The building stone business in Taivassalo has been sold, and
manufacture of natural stone products has been concentrated at the Espoo
factory. The negotiations regarding the outsourcing of machine work in
quarrying have been completed. In the future, external contractors will carry
out a substantial part of the machine work in quarrying.
As a result of the centralisation of functions, the number of employees in the
Group is reduced by 55, of whom 43 people have been made redundant. 12 people
transferred to another employer as a result of the divestment of businesses.
Net sales for the reporting period include EUR 0.4 million in net sales
resulting from the sale of the building stone business's inventories, and the
result includes the non-recurring expenses from the arrangement, amounting to
approximately EUR 0.6 million net. Of these expenses, the restructuring
provision accounts for approximately EUR 0.5 million, impairment losses, other
expenses and expense reserves account for EUR 0.3 million, and sales gains EUR
0.2 million. Of the net expenses, EUR 0.4 million is from the Fireplaces
Business and EUR 0.2 million from the Natural Stone Products Business. The
effect of the sale of the building stone business on net sales for 2011 is EUR
-0.6 million, but this will not have a substantial impact on the result for the
final part of the year.
Focusing on core businesses will enable improvement of the Group's
profitability in the 2012 financial year and beyond. The arrangement reduces
annual net sales by slightly under EUR 3.0 million.
Net sales and result
Consolidated net sales were EUR 43.3 million (EUR 39.3 million in
January-September 2010). The net sales of the Fireplaces Business were EUR 39.1
(35.3) million and of the Natural Stone Products Business EUR 4.2 (4.0)
million. The like-for-like net sales of the Natural Stone Products Business
were EUR 3.8 million.
Net sales in Finland accounted for EUR 23.5 (20.8) million, or 54.4 (53.0) per
cent, of total net sales. Exports amounted to EUR 19.8 (18.5) million in net
sales. The principal export countries were Sweden, France and Germany. The
growth in export net sales was from increased lining stone sales. Fireplace
exports have not developed according to plan due to the lower demand.
The Group's operating result after the above-mentioned expenses from
centralisation was a loss of EUR -1.3 (-1.1) million and the operating result
before expenses caused by concentration was EUR -0.7 (-1.1) million.
The Fireplaces Business had an operating profit of EUR 0.6 (0.6) million, and
the Natural Stone Products Business had an operating loss of EUR -0.5 (-0.3)
million, while expenses under other items were EUR -1.4 (-1.4) million. In
addition to the expenses from the centralisation of functions, the operating
profit during the reporting period was burdened by non-recurring expenses of
EUR 0.8 million from the launch of electric sauna heaters, expansion of the
Finnish distribution channel, the redesign of the corporate image and the
introduction of a new information system.
The consolidated result before taxes was a loss of EUR -1.9 (-1.6) million and
the consolidated result before expenses caused by concentration was EUR -1.3
(-1.6) million. The result for the reporting period was a loss of EUR -1.4
(-1.2) million and earnings per share amounted to EUR -0.04 (-0.03).
The Group's third-quarter net sales totalled EUR 15.1 (13.9) million, the
operating profit was EUR 0.5 (0.2) million and the profit before taxes EUR 0.3
(0.1) million. Earnings per share amounted to EUR 0.00 (0.00).
Financing and investments
Cash flow from operating activities before investments was EUR -1.5 (-1.0)
million. Working capital increased by EUR 2.0 (3.1) million in the period and
came to EUR 9.3 million (EUR 9.5 million on 30 September 2010).
Interest-bearing debt was EUR 27.7 (25.8) million and net financial expenses
were EUR 0.6 (0.6) million. The equity ratio was 33.3 (36.9) per cent. The
ratio of interest-bearing net debt to equity, or gearing, was 101.0 (82.9) per
cent. The current ratio was 1.7 (1.8). Equity per share was EUR 0.53 (0.59).
The Group has a solid financial position. At the end of the reporting period,
the Group's cash assets were EUR 7.7 (7.8) million and unused credit limits
amounted to EUR 1.0 (4.0) million. The Group's debt financing, totalling EUR
16.0 (12.5) million, includes covenants which are tied to the Group's equity.
All covenant conditions were met at the close of the reporting period.
The Group's investments in production, quarrying and development were EUR 3.3
(2.0) million in the reporting period. Research and development costs were up,
to a total of EUR 1.8 (1.4) million, i.e. 4.1 (3.4) per cent of net sales. EUR
0.5 (0.3) million of development costs was capitalised in the balance sheet.
In September, the new modular design fireplace Suvas was launched as well as
ceramic fireplace models decorated with nature-themed decals. The development
of the Green products has continued. In February, the Group launched its range
of electric sauna heaters. Development of the heaters and sauna products is
continuing, and new products will be introduced later in the year. Other major
development projects include development of the Group's processes and renewal
of the enterprise resource planning system.
Personnel
The Group employed 481 (488) people at the end of the reporting period. As a
result of the centralisation of functions, the number of employees in the Group
is reduced by 55, of whom 43 people were made redundant. 12 people transferred
to another employer as a result of the divestment of businesses. Salaries and
bonuses during the reporting period totalled EUR 12.3 (11.2) million. The Group
employed an average of 437 (389) people during the reporting period.
Annual General Meeting
Tulikivi Corporation's Annual General Meeting, held on 14 April 2011, resolved
to pay a dividend of EUR 0.0250 on A shares and EUR 0.0233 on K shares. The
dividend payout date was 28 April 2011. The other decisions of the general
meeting can be found in the separate release published on the date of the
meeting.
Near-term risks and uncertainties
The probability of an economic downturn in Europe has increased. The Group's
risks in the near future include negative fluctuations in the economy. Another
risk is that consumer demand may be driven solely by price and not by the
qualities of the product.
The renewal of the ERP system is in progress. Timetable and cost risks are
often associated with such projects.
More information on risks can be found in the 2010 Board of Directors' report
and the notes to the financial statements.
Future outlook
Changes in consumer confidence will have an effect on demand for Tulikivi
products in the near future. In Finland and the rest of Northern Europe, demand
is expected to remain comparatively good. Moreover, sales in Finland will be
supported by the new sauna and fireplace products and an expanding distribution
network.
In Central Europe, the economic crisis will have a greater effect on consumers'
decision-making, and thus on fireplace demand.
Despite the uncertainty caused by the economic crisis, the company's full year
like-for-like net sales will be up by slightly under 10 per cent, and the
operating profit before non-recurring items is expected to improve on the
previous year. The full-year operating result taking into account the
non-recurring expenses is expected to be negative, however, and at the same
level as the previous year.
TULIKIVI CORPORATION
Board of Directors
Matti Virtaala Chairman of the Board
Distribution: NASDAQ OMX Helsinki Ltd
Central Media
www.tulikivi.com
Additional information: Tulikivi Corporation, 83900 Juuka, www.tulikivi.com
- Chairman of the Board of Directors Matti Virtaala, +358 207 636 666
- Managing Director Heikki Vauhkonen, +358 207 636 555
© 2024 Nasdaq, Inc. All Rights Reserved |