2017-02-03 07:30:02 CET
2017-02-03 07:30:02 CET
REGULATED INFORMATION
Martela Oyj - Financial Statement Release
MARTELA CORPORATION'S FINANCIAL STATEMENTS RELEASE, 1 JANUARY - 31 DECEMBER 2016
3rd February, 2017 08:30 am
The January–December 2016 revenue was on the previous year’s level and the
operating result improved slightly.
October–December 2016
-- Revenue EUR 34.3 million (10–12/2015: 37.5), change -8.6%
-- Comparable operating result improved by 7.0 % and was EUR 2.2 million (2.1)
-- Comparable operating profit ratio was 6.5 % (5.6 %)
-- Operating result improved by 0.4 % and was EUR 2.1 million (2.1)
-- Result declined by 48.9 % and was EUR 0.8 million (1.5)
-- Earnings per share amounted to EUR 0.18 (0.37)
January–December 2016
-- Revenue was on the previous year’s level at EUR 129.1 million (132.8),
change -2.8 %
-- Comparable operating result improved by 68.7 % and was EUR 6.9 million
(4.1)
-- Comparable operating profit ratio was 5.3 % (3.1 %)
-- Operating result improved by 51.1 % and was EUR 6.2 million (4.1)
-- Result for the period improved by 33.5 % and was EUR 3.3 million (2.5)
-- Earnings per share were EUR 0.81 (0.61)
Outlook for 2017
The Martela Group anticipates that its 2017 revenue and IFRS operating result
will remain on the 2016 level.
Due to normal seasonal variations, the Group’s operating result accumulates
mainly during the second half of the year.
Key figures, EUR million
2016 2015 Change 2016 2015 Change
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10-12 10-12 % 1-12 1-12 %
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Revenue 34,3 37,5 -8,6 129,1 132,8 -2,8
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Comparable operating result* 2,2 2,1 7,0 6,9 4,1 68,7
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Comparable operating result %* 6,5 5,6 5,3 3,1
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Operating result 2,1 2,1 0,4 6,2 4,1 51,1
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Operating result % 6,1 5,6 4,8 3,1
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Result before taxes 2,0 1,9 2,3 5,6 3,4 65,9
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Result for the period 0,8 1,5 -48,9 3,3 2,5 33,5
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Earnings/share, eur 0,18 0,37 -49,1 0,81 0,61 32,3
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Return on investment % 25,0 24,8 18,2 12,1
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Return on equity % 12,7 27,6 13,9 11,6
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Equity ratio % 45,3 40,9
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Gearing % -18,9 16,6
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*Martela applies the European Securities and Markets Authority (ESMA)
guidelines on disclosing alternative performance measures. The guidelines took
effect on 3 July 2016. Martela discloses alternative performance measures to
illustrate the financial performance of its business operations and to improve
intra-period comparability. The alternative performance measures should not be
considered a substitute for the IFRS performance measures. The reconciliation
of the ESMA performance measures with the most directly reconcilable IFRS-based
items has been presented in the financial statements information of this
financial statements report.
Matti Rantaniemi, CEO:
"In the fourth quarter, our business operations developed as anticipated and we
are satisfied with the company's overall financial performance in 2016. Revenue
was at a good level, profitability improved and the cash flow from operating
activities was also good.
Revenue for January–December was EUR 129.1 million, which is at the previous
year’s level (132.8). The comparable consolidated operating result was EUR 6.9
million (4.1), which is 68.7% higher than in the comparison period. The
comparable operating result for the October–December period was EUR 2.2 million
(2.1), and growth was 7%. The cash flow from operating activities in
January–December was EUR 11.7 million (3.9).
With the positive performance of the Business Unit Finland & Sweden, the
consolidated revenue for the review period was on the 2016 level. For the
Business Unit International, revenue declined in Poland and Norway while it
grew in Russia and other international operations.
The discontinuation of Martela’s own sales operations in Poland and Russia,
announced in June, has been completed according to plan. EUR 0.7 million in
non-recurring expenses have been recorded on the discontinuation and this is
not included in the company's comparable operating result. The Warsaw
production and purchasing unit will continue operations and is an integral part
of Martela’s Customer Supply Management organisation. The closure of the
Swedish Bodafors unit, which was announced earlier, has also been completed.
The assembly work carried out at Bodafors has been concentrated in our Nummela
production unit and the distribution to our logistics partners.
The EUR 4 million savings programme for variable and fixed costs launched in
2015 has been completed in full and it will have full effect in 2017. At the
same time, however, the Group will continue to invest in implementing and
further developing its Martela Lifecycle strategy, which will increase fixed
costs somewhat, preventing the Group’s cost level from falling by the full
amount of the savings referred to above.
In 2016 we refocused our Martela Lifecycle strategy to match the ongoing change
in the way people work. The key aspects of our updated strategy are: Martela
offers people-centric workplaces, provides all workplace services through a
single point of contact, and focuses on the Nordic countries, and its goal is
to achieve an EBIT level of 8% by the end of 2018 (excluding non-recurring
items).
The responsibilities of the Management Team’s members have been reassigned and
Martela’s organisation changed to match the refocused strategy. All business
units were concentrated in the Customers and Workplace Services unit and
removal services and IT functions were added into the Customer Support
Management unit, in addition to sourcing, production, delivery and quality
which were already part of the unit.
The principal investment in the financial year was the New Business Platform
(NBP), worth EUR 2.2 million, which mainly concerned the IT system reforms
required to implement the Martela Lifecycle strategy. The launch of these
reforms in the first half of 2017 will be a demanding period for everyone at
Martela but the reforms will provide us with an agile foundation for developing
our business as a comprehensive service in accordance with the Lifecycle
strategy.
The year 2017 will largely be a continuation of 2016. We will focus on
improving profitability, implementing the Martela Lifecycle strategy, deploying
the New Business Platform (NBP), developing Martela’s offering and improving
operations and improving job satisfaction among our employees."
Market
No material changes took place in the market during the fourth quarter. 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.
The annual change in a country’s gross domestic product (GDP) can be regarded
as an indicator of general economic development. GDP is estimated to have grown
at least somewhat in all of Martela’s main markets in 2016 and this development
will continue in 2017.
The need to boost efficiency often leads to office alteration projects, which
in turn generate demand for Martela. What is more, an increasing number of
workplaces and learning environments have understood that the environment
itself plays an important role in improving productivity. The Martela Lifecycle
model responds well to such needs to develop workplaces in businesses and the
public sector, and to this end, we have focused on our competence in workplace
specification, planning and maintenance services.
The estimated size of the Nordic workplace market is approximately one billion
euros. In Sweden the market relevant to Martela is more than twice the size of
what it is in Finland, and the Norwegian market is close in size to its Finnish
counterpart.
Revenue and operating result
Revenue and result for October–December 2016
Revenue declined in October–December by 8.6 % and was EUR 34.3 million (37.5).
The revenue of the Business Unit Finland & Sweden declined by 4.0 % on the
previous year. Due to the timing of projects, revenue fell in Finland and
increased in Sweden. The revenue of the Business Unit International declined by
42.1 % on the previous year. Revenue declined in Poland and remained on the
2015 level in Norway. Revenue from Russian and other international operations
increased on the previous year. Fourth quarter revenue from operations in
Russia was significantly lower than that of the preceding quarter.
The consolidated operating result for the fourth quarter grew by 0.4 % and was
EUR 2.1 million (2.1).
EUR 0.1 million was recorded in the second quarter in costs affecting
comparability, which arose from the discontinuation of the own Polish and
Russian sales operations. Consolidated revenue grew as a result of improved
operating efficiency.
The October–December result before taxes was EUR 2.0 million (1.9), an increase
of 2.3 %. The October–December result was EUR 0.8 (1.5), a decline of 48.9 %.
Revenue and result for January–December 2016
Revenue for January-December was EUR 129.1 million, which is at the previous
year’s level (132.8). The revenue of the Business Unit Finland & Sweden grew by
2.5 % on the previous year. Finnish revenue for the four quarters was on last
year’s level while in Sweden the corresponding figure improved year-on-year.
The revenue of the Business Unit International declined by 32.7 % on the
previous year. In Poland and Norway, revenue declined while in Russia and other
international operations it grew.
The discontinuation of Martela’s own sales operations in Poland and Russia,
announced in June, has been completed. The Warsaw production and purchasing
unit will continue operations and is an integral part of Martela’s Customer
Supply Management organisation. The closure of the Bodafors plant and logistics
centre, which was announced earlier, has also been completed.
The EUR 4 million savings programme for variable and fixed costs launched in
2015 has been completed in full and it will have full effect in 2017. At the
same time, however, the Group will continue to invest in implementing and
further developing its Martela Lifecycle strategy, which will increase fixed
costs somewhat, preventing the Group’s cost level from being reduced by the
full amount of the savings referred to above.
The comparable consolidated operating result for the January–December period
was EUR 6.9 million (4.1), which is 68.7 % higher than in the comparison
period. EUR 0.7 million was recorded in the period in costs affecting
comparability, which arose from the discontinuation of the own Polish and
Russian sales operations. As a result, the January–December IFRS operating
result was EUR 6.2 million (4.1), which is 51.1 % better than in the comparison
period.
The January–December result before taxes was EUR 5.6 million (3.4), an increase
of 65.9 %. The increase in taxes recorded for the period was due to the
improved result at the mother company.
Profit for the January–December period was EUR 3.3 million (2.5), and growth
was 33.5 %.
EVENTS AFTER THE END OF THE FINANCIAL YEAR
No significant events requiring reporting have taken place since the
January–December period, and operations have continued according to plan.
SHORT-TERM RISKS
The principal risk regarding profit performance relates to the general economic
uncertainty and the consequent effects on the overall demand in Martela’s
operating environment.Due to the project-based nature of the sector,
forecasting short-term developments is challenging.
The New Business Platform IT reform that will take place in the first half of
2017 may pose operating challenges that may impact business operations in the
short term.Risks are being minimised by conducting sufficient testing, ensuring
sufficient resources and by implementing standard features of the systems.
OUTLOOK FOR 2017
The Martela Group anticipates that its 2017 revenue and IFRS operating result
will remain on the 2016 level.Due to normal seasonal variations, the Group’s
operating result accumulates mainly during the second half of the year.
PROPOSAL OF THE BOARD OF DIRECTORS FOR DISTRIBUTION OF PROFIT
The Board of Directors will propose to the AGM that a dividend of EUR 0.37 per
share be distributed for 2016.
ANNUAL GENERAL MEETING
Martela Corporation’s AGM will be held on 14 March 2017 at 3 p.m. in Martela
House, Helsinki.The notice of Annual General Meeting will be published in a
separate stock exchange release.
The Martela 2016 Annual Report will be published on the company’s website
during the week 8/2017.
The whole financial statements release is attached as pdf.
Martela Corporation
Board of Directors
Matti Rantaniemi
CEO
Further information
Matti Rantaniemi, CEO, tel 050 465 8194
Riitta Järnstedt, CFO, tel 040 508 4993
Distribution
NASDAQ OMX Helsinki
Main news media
www.martela.com
Martela carries user-centric workplaces and learning environments. We offer our
customers a single point of contact for the entire lifecycle of the workplace,
from specifying need to optimising maintenance. The company was founded in 1945
and it is one of the biggest in its field in the Nordic countries.
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