2017-03-21 08:02:10 CET
2017-03-21 08:02:10 CET
REGULATED INFORMATION
Kotipizza Group Oyj - Financial Statement Release
Kotipizza Group Oyj: FINANCIAL STATEMENTS BULLETIN 1 FEBRUARY 2016 - 31 JANUARY 2017
FINANCIAL YEAR ENDED WITH STRONG FOURTH QUARTER, BOARD OF DIRECTORS PROPOSES
0.50 EUROS PER SHARE DISTRIBUTION FROM FUND FOR INVESTED UNRESTRICTED EQUITY
November 2016-January 2017 (11/2016-1/2017)
* Chain-based net sales were 23.8 MEUR (20.4). Growth was 16.6%
* Comparable net sales were 17.5 MEUR (14.6). Growth was 19.5%
* Comparable EBITDA was 1.53 MEUR (1.17). EBITDA growth was 31.3%
* Comparable EBIT was 1.29 MEUR (0.85)
February 2016-January 2017 (2/2016-1/2017)
* Chain-based net sales were 89.9 MEUR (77.3). Growth was 16.3%
* Comparable net sales were 66.6 MEUR (56.4). Growth was 18.1%
* Comparable EBITDA was 6.73 MEUR (5.03). EBITDA growth was 33.8%
* Comparable EBIT was 5.75 MEUR (4.27)
* Net gearing was 24.0 percent (31.8%)
* Equity ratio was 51.7 percent (51.8%)
OUTLOOK FOR THE FINANCIAL YEAR 2018
The Group estimates for the full financial year that the chain-based net sales
will grow by over five (5) percent as compared to the previous financial year
and that comparable EBITDA will grow as compared to the previous year.
BOARD OF DIRECTORS' PROPOSAL FOR DISTRIBUTION FROM FUND FOR INVESTED
UNRESTRICTED EQUITY
The board of directors proposes 0,50 euros per share distribution from Fund for
invested unrestricted equity for the financial year of 1 February 2016 - 31
January 2017.
IMPACT OF NEW ESMA GUIDELINES
New ESMA (European Securities and Markets Authority) guidelines on Alternative
Performance Measures (APMs) became effective for the financial year 2016.
Kotipizza Group presents APMs to reflect the underlying business performance and
to enhance comparability between financial periods. APMs should not be
considered as a substitute for measures of performance in accordance with the
IFRS. Items affecting comparability and APMs used by Kotipizza Group are defined
in note 6 of this report.
KEY FIGURES, TEUR 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
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Comparable figures
Comparable net sales 17 452 14 605 66 580 56 370
Comparable EBITDA 1 530 1 165 6 726 5 026
Comparable EBITDA of
8.8% 8.0% 10.1% 8.9%
net sales, %
Comparable EBIT 1 290 846 5 747 4 274
Reported figures
Chain-based net sales 23 838 20 442 89 893 77 266
Reported net sales 18 407 14 605 68 737 56 370
Reported EBITDA 1 338 1 165 6 225 4 187
Reported EBITDA of
7.7% 8.0% 9.3% 7.4%
net sales, %
Reported EBIT 1 098 846 5 246 3 435
Earnings per share 0.10 0.13 0.55 0.05
Net cash flows from operating 5 278 -671
activities
Net cash used in investment -449 -1 770
activities
Net gearing, % 24.0 31.8
Equity ratio, % 51.7 51.8
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Tommi Tervanen, CEO of Kotipizza Group
"Kotipizza's chain-based net sales continued their strong growth in the fourth
quarter of the financial year. The chain's net sales continued their excellent
development both in terms of same-store sales and the number of customers. In
brick-and-mortar restaurants, the number of customers increased by 15.3% and the
average purchase by 4.2%. The online store also continued to make progress -
during the review period, orders made through the online store amounted to
roughly a tenth of the net sales in brick-and-mortar restaurants. The chain-
based net sales growth was 16.6% in the fourth quarter, exceeding the average
growth in the Finnish fast food market. According to the Finnish Hospitality
Association MaRa, the domestic fast food market grew by 6.8% in 2016.
We expect the chain-based net sales to continue to develop favorably. Achieving
similar relative growth figures will, however, become more challenging month by
month as we draw comparisons to months of very strong growth in the previous
year.
There are several factors behind the strong growth in chain-based net sales. One
of the main reasons is Kotipizza's brand and concept reform that was launched at
full speed in the beginning of 2015 and which has now been mostly finalized. The
Group has consistently developed the Kotipizza chain in the spirit of the fast
casual phenomenon, emphasizing the freshness, authenticity and sustainability of
our food, as well as actively following the developments in food trends and
consumer preferences.
For example, we have noted the rise in demand for vegetarian options and have
therefore added Härkis, a pizza topping made of fava beans, as well as vegan
cheese to our menu. During the review period, the sales of vegetarian pizzas in
our online store increased by 419 percent compared to previous financial year.
In turn, a good example of our achievements in working towards greater
sustainability is the MSC ecolabel awarded to the Kotipizza chain during the
review period, proving that all fish and seafood products we use come from
sustainable sources and responsible fisheries. Kotipizza is the first pizza
chain in the world to merit the MSC ecolabel.
After the review period, the Group's largest shareholder, Sentica Partners, made
an exit from the Group selling its entire 63.3 percent stake in an accelerated
book-building process to international and Finnish institutional investors.
International investors were particularly interested in the Group, as their
share grew from 4.5 percent to 41.9 percent in the transaction. The share can be
considered exceptionally high for a Finnish company of this size. At the same
time, the number of shares being traded, i.e. the free float, grew considerably,
which has also been reflected in the daily trading of shares by a clear perking-
up in the trading volume. I would once again like to welcome all our new owners.
Comparable net sales of the Group grew 20% in the fourth quarter of the year and
were 17.5 MEUR (14.6). Comparable EBITDA was 1.53 MEUR (1.17) in the fourth
quarter, representing a growth of 31%. The corresponding growth figures for the
full financial year were 18 and 34 percent, respectively. We are still on pace
with our medium-term financial goals, both in terms of the development of chain-
based sales as well as that of EBITDA. The Group had a solid financial standing
at the end of the quarter with net gearing at 24 percent and equity ratio of 52
percent.
According to MaRa's estimates, the growth of sales in the restaurant sector will
continue in 2017 at nearly the previous year's level, along with the growth of
the Finnish national economy and the increased consumer confidence. The
development will be particularly positive in the fast food sector, as fast food
restaurants account for a considerable proportion of restaurant dining.
The growth of sales in the Kotipizza chain has continuously outperformed the
growth of the entire restaurant market and the fast food market. It can even be
estimated that the strong growth of the Kotipizza chain has contributed to the
more positive development of the fast food market compared with the rest of the
restaurant market. We believe that the financial development of the restaurant
business and consumer trends support Kotipizza Group's investment in the fast
casual concept, that is, restaurants that offer casual, fresh and responsibly
produced food in a restaurant environment.
We estimate that the group's chain-based net sales will, during the present
financial year, grow by more than five (5) percent as compared to the previous
financial year, and that the comparable gross margin / EBITDA will grow as
compared to the previous financial year."
GROUP NET SALES
November 2016-January 2017
Chain-based net sales continued strong and grew 16.6% (15.2%) year on year in
the fourth quarter of the financial year and were 23.8 MEUR (20.4). Average
purchase grew 4.2% and the number of customers 15.3% compared to the same period
in the previous year. The strong performance is based on renewed concept, brand,
successful marketing, and the emphasis placed on our online store and digital
presence.
Kotipizza continued to seek visibility with successful campaigns on TV as well
as social and online media in the last quarter of the financial year. In
November, Kotipizza had lower-calorie Kotzones and in December the classic
Lihamestari pizza in a TV campaign. Launched in January, our cooperation with
the very famous TV show Putous was received well. The show reached 3.6 million
Finnish spectators and 78% of all families with children. Our Hokituur
collaboration with Radio Rock Korporaatio, realized in November-December, was
also received well. Kotipizza had altogether 56 campaign days during the fourth
quarter of this financial year compared to the 45 in the previous year.
Increased investments in our own social media channels gained very positive
feedback too. We continued, for example, with our online series on Kotipizza
franchisees on Facebook and our cooperation with top Finnish YouTube stars, who
also took part in our Kotipizza Games in January. By doing so, we were able to
create a strong increase in the extent to which viewers retain our ads compared
to previous year. Three new Kotipizza restaurants were opened and none were
closed during the fourth quarter of the financial year.
Comparable net sales for the fourth quarter of the financial year were 17.5 MEUR
(14.6) and they grew 19.5% compared to same period in the previous year.
Reported net sales were 18.4 MEUR (14.6) and they grew 26.0% compared to same
period in the previous year. The reported sales included 1.0 MEUR items
affecting comparability related to advertising and marketing fund flows of
Kotipizza's Franchisee Co-operative, which pass through Kotipizza division's P&L
without result effect. A separate stock exchange release on this was given on
30 May 2016.
Comparable net sales growth was mainly based on Foodstock's increased sales
volume to Kotipizza, underpinned by the good restaurant chain sales development.
Foodstock's new customers such as Espresso House, Fafa's and the Siipiravintolat
chain, which were not yet Foodstock's customers in the previous year, increased
net sales. The net sales of Foodstock grew 24.3% year on year in the fourth
quarter of the financial year and were 14.2 MEUR (11.4). The Kotipizza segment's
net sales increased 38.4% compared to the previous year and were 4.2 MEUR (3.0).
The Chalupa segment's net sales in the fourth quarter of the financial year were
EUR 41 thousand (EUR 165 thousand). Decline in net sales compared to the
previous year was due to Chalupa owning only one restaurant at the end of the
review period. As the remaining five restaurants are sold to franchisees,
Chalupa's revenue recognition has changed from fully consolidating restaurants
to consolidating fees related to franchising contracts.
February 2016-January 2017
Chain-based net sales grew 16.3% (9.7%) year on year in the financial year and
were 89.9 MEUR (77.3). The chain-based net sales growth was based on both an
increase in the average purchase and increase in the number of customers. A
comprehensive menu reform was carried out in the summer 2014, and successful new
products together with targeted, influential marketing that emphasizes
sustainability have positively changed consumers' brand experience of Kotipizza.
This has translated into an increase in the number of customers. Twelve new
Kotipizza restaurants were opened and twelve closed during the review period.
The chain-based net sales are the total combined net sales of the company's
franchisees, based on which the company's franchising fees are invoiced monthly.
Comparable net sales for the financial year were 66.6 MEUR (56.4) and they grew
18.1% compared to same period in the previous year. Reported net sales were
68.7 MEUR (56.4). The reported sales included 2.2 MEUR items affecting
comparability related to advertising and marketing fund flows of Kotipizza's
Franchisee Co-operative, which pass through Kotipizza division's P&L without
result effect. A separate stock exchange release on Kotipizza's Marketing Co-
operative's change into Franchisee Co-operative was given on 30 May 2016.
Comparable net sales growth was mainly based on Foodstock's increased sales
volume to Kotipizza underpinned by the good chain-based sales development.
Foodstock's new customers such as Espresso House, Fafa's and the Siipiravintolat
chain, which were not yet Foodstock's customers in the previous year, increased
net sales. The net sales of Foodstock grew 20.6% year on year in the financial
year and were 53.2 MEUR (44.1). The Kotipizza segment's net sales increased
27.7% compared to the previous year and were 15.1 MEUR (11.8). The Chalupa
segment's net sales in the financial year were 0.5 MEUR (0.4).
GROUP EBIT
November 2016-January 2017
Comparable EBIT of the Group was 1.29 MEUR (0.85) in the fourth quarter of the
financial year. Reported EBIT was 1.10 MEUR (0.85). Reported EBIT included MEUR
0,19 of items affecting comparability (calculatory, non-cash), which were
related to incentive program introduced on 6 May 2016 and other incentive
schemes within the group. The reported EBIT of the previous year included EUR
30 thousand of items affecting comparability related to listing the company's
shares to the Nasdaq OMX Helsinki stock exchange. These items had a cash flow
effect.
The EBIT improved mainly due to volume improvement, but the sales margin also
improved slightly from the previous year.
February 2016-January 2017
Comparable EBIT of the Group was 5.75 MEUR (4.27) in the financial year.
Reported EBIT was 5.25 MEUR (3.44). Reported EBIT included MEUR 0,50 of items
affecting comparability (calculatory, non-cash), which were related to incentive
program introduced on 6 May 2016 and other incentive schemes within the group.
The reported EBIT of the previous year included 0.84 MEUR of items affecting
comparability. Costs amounting to MEUR 0.23 related to initial public offering
of company's shares to the Nasdaq OMX Helsinki Oy's stock exchange and 0.50 MEUR
due to the permanent closing of Kotipizza Oyj's previous headquarters in Vaasa
had a cash flow effect. In addition, the previous year's reported EBIT included
0.12 MEUR non-cash deferral error related to Foodstock's inventory as an item
affecting comparability.
The EBIT improved mainly due to volume improvement, but the sales margin also
improved slightly from the previous year. Fixed cost growth was also below the
volume growth. The clearly higher depreciations compared to the previous year
(non-cash item) had a negative impact on the EBIT.
SALES AND EBITDA OF THE SEGMENTS
KOTIPIZZA SEGMENT
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EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
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Comparable net sales 3 247 3 035 12 894 11 784
Net sales 4 202 3 035 15 051 11 784
Comparable gross margin/EBITDA 1 552 1 379 6 633 5 465
Depreciation and impairments -148 -269 -589 -584
Comparable EBIT 1 404 1 110 6 044 4 881
Reported gross margin/EBITDA 1 499 1 379 6 517 5 196
Reported EBIT 1 352 1 110 5 929 4 612
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Olli Väätäinen, COO of Kotipizza
"Growth in sales in the Kotipizza chain has continued strong during the review
period. It should be noted that in addition to the rollout of the restaurant
design facelift, the reform of the restaurant network has been finalized. In the
past two years, several particularly unprofitable shop-in-shop restaurants have
been closed, and while new brick-and-mortar restaurants have simultaneously been
opened, the total number of restaurants has decreased. At the end of the review
period, the number of restaurants stood at 257 (257), after which the number has
once again started to rise through the opening of new brick-and-mortar
restaurants. During the review period, Kotipizza also continued to develop its
online store. Orders made through the online store amounted to roughly a tenth
of the net sales in brick-and-mortar restaurants during the period. Online sales
were particularly significant in brick-and-mortar restaurants offering a
delivery service, constituting nearly a fifth of total sales."
November 2016-January 2017
Comparable net sales of Kotipizza for the fourth quarter of the financial year
were 3.25 MEUR (3.04) and they increased 7.0% compared to same period in the
previous year. Net sales of Kotipizza for the fourth quarter of the financial
year were 4.20 MEUR (3.04) and they increased 38.4% compared to same period in
the previous year. The reported sales included 1.00 MEUR items affecting
comparability related to advertising and marketing fund flows of Kotipizza's
Franchisee Co-operative, which pass through Kotipizza-division's P&L without
result effect. A separate stock exchange release on this was given on 30 May
2016. The rest of the sales increase was based on growth in chain-based net
sales and in consequence all franchising contract based net sales increased.
Kotipizza's comparable EBITDA was 1.55 MEUR (1.38) in the fourth quarter of the
financial year and it grew 12.5% compared to same period in the previous year.
Improvement in comparable EBITDA was mainly due to favourable development in
chain-based net sales of Kotipizza. Reported EBITDA was 1.50 MEUR (1.38) in the
fourth quarter of the financial year. Reported EBITDA included EUR 52 thousand
of items affecting comparability (calculatory, non-cash), which were related to
incentive program introduced on 6 May 2016 and other incentive schemes within
the group.
February 2016-January 2017
Comparable net sales of Kotipizza for the financial year were 12.89 MEUR (11.78)
and they had increased by 9.4% compared to same period in the previous year. Net
sales of Kotipizza for the financial year were 15.05 MEUR (11.78) and they
increased by 27.7% compared to same period in the previous year. The reported
sales included 2.16 MEUR items affecting comparability related to advertising
and marketing fund flows of Kotipizza's Franchisee Co-operative, which pass
through Kotipizza-division's P&L without result effect. A separate stock
exchange release on this was given on 30 May 2016. Rest of the increase in net
sales was based on growth in chain-based net sales and in consequence all
franchising contract based net sales increased.
Kotipizza's comparable EBITDA was 6.63 MEUR (5.47) in the financial year and it
grew 21.4% compared to same period in the previous year. Improvement in
comparable EBITDA was mainly due to restructuring measures implemented in the
segment's operations and favourable development of chain-based net sales in
Kotipizza. Reported EBITDA was 6.52 MEUR (5.20) in the financial year. Reported
EBITDA included EUR 115 thousand of items affecting comparability (calculatory,
non-cash), which were related to incentive program introduced on 6 May 2016 and
other incentive schemes within the group. The previous year's comparable EBITDA
for the fourth quarter included in EUR 269 thousand of items affecting
comparability related to costs of closing company's previous headquarters. These
items had a cash flow effect.
FOODSTOCK SEGMENT
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EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
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Comparable net sales 14 165 11 396 53 198 44 096
Net sales 14 165 11 396 53 198 44 096
Comparable gross margin/EBITDA 252 218 1 596 964
Depreciation and impairments -38 -28 -143 -113
Comparable EBIT 214 190 1 453 851
Reported gross margin/EBITDA 239 218 1 566 849
Reported EBIT 200 190 1 423 736
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Anssi Koivula, CEO of Foodstock
"The strong sales growth in the Kotipizza chain has also been reflected in
Foodstock's operations during the review period. Despite strong growth, we have
managed to ensure the reliability of our deliveries and the quality of our
customer service, thanks to which our customer satisfaction has remained high.
Foodstock's operations have also been affected by the Kotipizza chain's growing
emphasis on sustainability and sourcing responsibly produced ingredients. The
MSC ecolabel awarded to Kotipizza during the review period is a direct result of
our long-standing commitment to sustainable fishing and using responsibly
produced fish and seafood products."
November 2016-January 2017
Comparable net sales of Foodstock for the fourth quarter of the financial year
were 14.17 MEUR (11.40) and they grew 24.3% compared to same period in the
previous year. Reported net sales of Foodstock for the fourth quarter of the
financial year were 14.17 MEUR (11.40) and they grew 24.3% compared to same
period in the previous year. The reported net sales did not include items
affecting comparability. The growth in net sales was mainly due to favourable
development in Kotipizza chain-based net sales, which had a positive boost to
Foodstock's delivery volumes for the chain. Net sales to the Rolls burger chain
increased notably compared to the previous year. The positive volume effect of
Foodstock gaining new customers from the previous year was also visible in the
reported numbers.
Foodstock's comparable EBITDA improved by 15.7% from the previous year and was
0.25 MEUR (0.22) in the fourth quarter of the financial year. Improvement in the
comparable EBITDA was due to operational gearing related to increase in sales
volume and to favourable sales mix. Foodstock's reported EBITDA was 0.24 MEUR
(0.22) in the fourth quarter of the financial year. Reported EBITDA included EUR
14 thousand of items affecting comparability (calculatory, non-cash), which were
related to incentive program introduced on 6 May 2016 and other incentive
schemes within the group.
February 2016-January 2017
Comparable net sales of Foodstock for the financial year were 53.20 MEUR (44.10)
and they grew 20.6% compared to same period in the previous year. Reported net
sales of Foodstock for the financial year were 53.20 MEUR (44.10) and they grew
20.6% compared to same period in the previous year. The reported net sales did
not include items affecting comparability. The growth in net sales was mainly
due to the favourable development in Kotipizza chain-based net sales, which gave
a positive boost to Foodstock's delivery volumes for the chain. Net sales to
Rolls burger chain also increased notably compared to the previous year. The
positive volume effect of Foodstock's new customers such as Fafa's, Espresso
House and the Siipiravintolat chain also increased the net sales.
Foodstock's comparable EBITDA was 1.60 MEUR (1.00) in the financial year and it
grew 65.6% compared to the same period in the previous year. Improvement in the
comparable EBITDA was due to operational gearing related to increase in sales
volume. Foodstock's reported EBITDA was 1.57 MEUR (0.86) in the financial year.
Reported EBITDA included EUR 30 thousand of items affecting comparability
(calculatory, non-cash), which were related to incentive program introduced on
6 May 2016 and other incentive schemes within the group. Previous year's EBITDA
included EUR 115 thousand of items (non-cash) affecting comparability, which
were related to Foodstock's accrual error.
CHALUPA SEGMENT
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EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
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Comparable net sales 41 165 487 443
Net sales 41 165 487 443
Comparable gross margin/EBITDA -13 1 -161 -66
Depreciation and impairments -1 -9 -27 -18
Comparable EBIT -14 -8 -188 -84
Reported gross margin/EBITDA -17 1 -169 -66
Reported EBIT -18 -8 -196 -84
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Iman Gharagozlu, Creative Director of Chalupa
"During the review period, the Chalupa chain continued to strengthen its
position on a franchising basis. At the same time, the work of refining, testing
and documenting the Chalupa concept continued, and the responsibility for
sourcing of ingredients was transferred to Foodstock. At the end of the review
period, Chalupa restaurants were operating in Helsinki in three locations as
well as in Kauniainen, Tampere, and Jyväskylä, one in each. Of the six
restaurants, five are operated by franchisees. In addition, Chalupa products
were available in one Kotipizza lunch restaurant."
November 2016-January 2017
Chalupa's comparable net sales were EUR 41 thousand (EUR 165 thousand) in the
fourth quarter of the financial year and comparable EBITDA was EUR -13 thousand
(EUR 1 thousand). Chalupa's reported net sales were EUR 41 thousand (EUR 165
thousand) in the fourth quarter of the financial year and reported EBITDA was
EUR -13 thousand (EUR 1 thousand). Decline in net sales compared to the previous
year was due to Chalupa owning only one restaurant at the end of the review
period. As the remaining five restaurants are sold to franchisees, Chalupa's
revenue recognition has changed from fully consolidating restaurants to
consolidating fees related to franchising contracts.
Reported EBITDA included EUR 4 thousand of items affecting comparability
(calculatory, non-cash), which were related to incentive program introduced on
6 May 2016 and other incentive schemes within the group. Chalupa owned only one
restaurant in Punavuori, Helsinki at the end of the review period and the
remaining five operated with franchising model.
February 2016-January 2017
Chalupa's reported net sales were EUR 487 thousand (EUR 443 thousand) in the
financial year and comparable EBITDA was EUR -161 thousand (EUR -66 thousand).
Chalupa's reported net sales were EUR 487 thousand (EUR 443 thousand) in the
financial year and reported EBITDA was EUR -169 thousand (EUR -66 thousand).
Reported EBITDA included EUR 8 thousand of items affecting comparability
(calculatory, non-cash), which were related to incentive program introduced on
6 May 2016 and other incentive schemes within the group. Chalupa owned only one
restaurant in Punavuori, Helsinki at the end of the review period. This will in
practise mean a change in the Chalupa segment's reporting from fully
consolidating restaurants into segments numbers to consolidating fees related to
franchising contracts.
OTHERS SEGMENT
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EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
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Comparable net sales 0 9 0 47
Net sales 0 9 0 47
Comparable gross margin/EBITDA -261 -433 -1 342 -1 337
Depreciation and impairments -53 -13 -219 -37
Comparable EBIT -314 -446 -1 561 -1 374
Reported gross margin/EBITDA -383 -433 -1 690 -1 792
Reported EBIT -436 -446 -1 909 -1 829
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The 'Others' segment mainly includes operations of the group headquarters.
November 2016-January 2017
Comparable and reported net sales of the Others segment were 0.00 MEUR (0.01) in
the fourth quarter of the financial year. Comparable EBITDA was -0.26 MEUR (-
0.43). Reported EBITDA was -0.38 MEUR (-0.43). Reported EBITDA included EUR 122
thousand of items affecting comparability (calculatory, non-cash), which were
related to incentive programs introduced on 6 May 2016 and other incentive
schemes in the group.
February 2016-January 2017
Net sales of the Others segment were 0.04 MEUR (0.05) in the financial year.
Comparable EBITDA was
-1.34 MEUR (-1.34). Reported EBITDA was -1.69 MEUR (-1.79). Reported EBITDA
included EUR 348 thousand of items affecting comparability (calculatory, non-
cash), which were related to the incentive program introduced on 6 May 2016 and
other incentive schemes within the group. In the previous year, the reported
EBITDA included EUR 455 thousand of items affecting comparability. Out of items
affecting comparability, EUR 229 thousand were related to listing of company's
shares to Nasdaq OMX Helsinki stock exchange and EUR 226 thousand related to
closing Kotipizza's Vaasa office. These items had a cash flow effect.
FINANCIAL ITEMS AND RESULT
Finance costs in the fourth quarter of the year were MEUR 0.21 (0.19). Finance
costs in the financial year were MEUR 0.81 (3.01). The materially higher
financing costs in the previous financial year were based on a significantly
more leveraged balance sheet structure together with higher interest rates on
debt. In addition to the normal finance costs, in the previous year a MEUR 0.90
cost related to the early redemption of the company's MEUR 30 unsecured bond was
booked.
Group taxes were MEUR -1.00 (-0.12) in the financial year.
The result of the period was MEUR 3.46 (0.22) in the financial year.
Earnings per share were EUR 0.55 (0.05) in the financial year.
THE GROUP'S FINANCIAL POSITION
Kotipizza Group's balance sheet total as of 31 October 2016 was MEUR 59.2
(56.5). The Group's non-current assets as at 31 October 2016 amounted to MEUR
40.6 (40.0), and current assets amounted to MEUR 18.5 (16.5).
The Group's net cash flow from operating activities for the financial year was
MEUR 5.3 (-0.7). Working capital was released in the amount of MEUR 0.90
(released 0.05).
The net cash flow from investment activities for the period was MEUR -0.45 (-
1.77). Investments in tangible and intangible assets for the period amounted to
MEUR 0.85 (1.98), and proceeds from sales of tangible assets were MEUR 0.40
(0.19).
The net cash flow from financing activities was MEUR -3.3 (5.4). The Group payed
out MEUR 2.2 as distribution from Fund for invested unrestricted equity to its
shareholders during the review period.
The Group's equity ratio was 51.7% (51.8%).
Interest-bearing debt amounted to MEUR 17.0 (17.4), of which current debt
accounted for MEUR 1.17 (1.04). Kotipizza Group Oyj redeem in full its three-
year unsecured bond with a nominal value MEUR 30 on 11 August 2015 with the
proceeds from the 4 June 2015 announced and 6 October 2015 implemented Initial
Public Offering and the new MEUR 17.0 term loans withdrawn on 7 August 2015. New
term loans have covenants.
Further information on Kotipizza Group's financial risks is presented in the
financial statements released on 31 January 2016.
INVESTMENTS
The gross investments for the period amounted to MEUR 0.85 (1.98). The Company's
investments to fixed assets, related mainly to IT systems, amounted to MEUR
0.85 (1.98).
PERSONNEL
On 31 January 2017, Kotipizza Group employed 47 people, all of whom worked in
Finland. At the end of the previous financial year on 31 January 2016, the
Company employed 38 people, all of whom worked in Finland.
BUSINESS TRANSACTIONS
Group structure was simplified by merging company shells Senhold 2 and Francount
Oy to Domipizza Oy and Frankis Finland Oy to Kotipizza Group Oyj. Mergers were
registered into the trade register on 30 June 2016. Simplifying continued by
merging Kotipizza Oyj to Domipizza Oy, which was registered to trade register on
31 January 2017 and by simultaneously renaming Domipizza Oy as Kotipizza Oyj.
CHANGES IN THE MANAGEMENT
There were no changes in Kotipizza Group's operative management, Board of
Directors or Management Board during the review period.
MANAGEMENT BOARD
Kotipizza Group's Management Board comprises five members: Tommi Tervanen (CEO),
Timo Pirskanen (Deputy to the CEO, CFO), Olli Väätäinen (Chief Operating
Officer), Anssi Koivula (Chief Procurement Officer) and Antti Isokangas (Chief
Corporate Responsibility and Communications Officer).
SHARES AND SHARE CAPITAL
Kotipizza Group Oyj's share capital at the end of the review period was EUR
80,000.00 and it comprised 6,351,201 shares. At the beginning of the review
period on 1 February 2016, the number of the shares was 6,351,201. At the end of
the period, the Company had 1615 (549) shareholders. The Company does not hold
any treasury shares.
Information about the company's shareholder structure by sector and size of
holding, as well as the largest shareholders, can be viewed on the company's
website at www.kotipizzagroup.com.
RESOLUTIONS OF THE GENERAL MEETINGS
Kotipizza Group's Annual General Meeting held on 11 May 2016 resolved that no
dividend is paid for the financial period ending 31 January 2016, but that EUR
0,35 per share was decided to be paid from the reserves for invested
unrestricted equity.
The AMG adopted the financial statements for financial year ending 31 January
2016 and discharged the members of the Board of Directors and CEO from liability
for the financial year ending 31 January 2016.
The AGM resolved the number of Board members to be six. Johan Wentzel, Minna
Nissinen, Petri Parvinen, Kim Hanslin and Kalle Ruuskanen were re-elected as
members of Board of Directors for a term of office that lasts until the end of
the next AGM. Marjatta Rytömaa was elected as a new member. Johan Wentzel was
re-elected as Chairman of the Board of Directors.
The AGM resolved that the members of the Board will be paid as follows: Chairman
of the Board of Directors Johan Wentzel and member Marjatta Rytömaa EUR 500 per
month (EUR 6 000 p.a.) and other members of the Board of Directors EUR 2 000 per
month (EUR 24 000 p.a.) each.
The AGM resolved that the remuneration for the auditor be paid according to
invoice approved by the company. The AGM resolved to re-elect audit firm Ernst &
Young Oy as the company's auditor for a term that ends at the closing of the
next AGM.
The AGM resolved to authorize the Board of Directors to decide on a share issue
on the following terms:
1 The authorization may be used in full or in part by issuing shares in
Kotipizza Group Oyj in one or more issues so that the maximum number of shares
issued is 635 000 shares.
2 The Board of Directors may also decide on a directed share issue in deviation
from the shareholders' pre-emptive rights in case there is a weighty financial
reason to do so, such as in order to finance or carry out acquisitions or other
business transactions, develop the company's capital structure, or in order to
use the shares for an incentive scheme. The Board of Directors would be
authorized to decide to whom and in which order the shares will be issued. In
the share issues shares may be issued for subscription against payment or
without charge.
3 Based on the authorization, the Board of Directors is also authorized to
decide on a share issue without payment directed to the company itself, provided
that the number of shares held by the company after the issue would be a maximum
of 10 per cent of all shares in the company. This amount includes shares held by
the company and its subsidiaries in the manner provided for in Chapter 15,
section 11 (1) of the Companies Act.
4 This authorization includes the right for the Board of Directors to decide on
the terms and conditions of the share issues and measures related to the share
issues in accordance with the Companies Act, including the right to decide
whether the subscription price will be recognized in full or in part in the
invested unrestricted equity reserve or as an increase to the share capital.
5 The authorization is valid until 31 July 2017.
6 The authorization will supersede the authorization to decide upon share issues
given to the company's Board of Directors on 28 May 2015.
RISKS AND UNCERTAINTIES
In the long term, Kotipizza Group's operative risks and uncertainties relate to
a possible failure in predicting consumer preferences and in creating attractive
new concepts, as well as to new business risks related to possible expansion to
new cities and abroad. The competitive situation is expected to remain tough in
the fast food industry. Company's management cannot affect the general market
development and consumer behaviour with its actions.
Restaurant openings also have a major impact on the company's franchising and
rent income, income received from selling raw materials and supplies, and income
related to transport and the flow of goods, thus affecting the company's
financial result.
Kotipizza Group is currently launching a new fast casual concept, which is
reported as the Chalupa segment. Launching a new business concept has several
risks related to e.g. anticipating consumer needs, habits, preferences and
behaviour. Launching a new concept holds the risk of not reaching an established
position in the market and not having a well-established clientele. Potential
failure in launching a new concept generates costs to the company and can have a
significantly adverse impact on the company's brand, financial position and
financial result.
EVENTS AFTER THE REPORT PERIOD
On 1 February 2017, Kotipizza Group acquired all business operations of Helsinki
Pizzapalvelu Oy with the intention of merging the 22 Pizzataksi restaurants
operating in the Helsinki region and Southern Finland with the operations of the
Kotipizza chain. The transaction was aimed at strengthening Kotipizza's home
delivery service offering in the Helsinki region.
Helsinki Foodstock Oy a sourcing and logistics operator wholly owned by
Kotipizza Group Oyj signed an agreement with Street Gastro Oy making it
responsible for supply chain management for the chain of restaurants operating
under the name Street Gastro in Finland on 9 February 2017.
Group's Chief Operating Officer and member of the Management Board Olli
Väätäinen resigned from his position on 17 February 2017.
'OUTLOOK FOR THE FINANCIAL YEAR 2018
According to the report of the Finnish Hospitality Association MaRa, sales grew
briskly in the restaurant business in 2016. The total sales of the restaurant
business increased by 3.5 per cent in January-September 2016 and the sales of
fast food restaurants increased by 6.8 per cent in the year 2016.
The total value of the Finnish restaurant market is approximately five billion
euros. The most important factors influencing the development of the sector
include the general economic development, consumers' disposable income, taxation
and government regulation. Consumers' preferences and, increasingly, food trends
influence financial development within the sector.
Finns are dining at restaurants more and more often, which is a key driver of
growth in the business. According to the trend survey published by MaRa in
December 2016, altogether 77 per cent of the respondents had dined at a
restaurant during the previous two weeks. The figure was 67 per cent in 2014 and
only about 40 per cent at the turn of the millennium.
The growth of sales in the Kotipizza chain has continuously outperformed the
growth of the entire restaurant market and the fast food market. It can even be
estimated that the strong growth of the Kotipizza chain has contributed to the
more positive development of the fast food market compared with the rest of the
restaurant market.
According to MaRa's estimate, the growth of sales in the restaurant sector will
continue in 2017 at nearly the previous year's level, along with the growth of
the Finnish national economy and the increased consumer confidence. The
development will be particularly positive in the fast food sector, as fast food
restaurants account for a considerable proportion of restaurant dining. In the
fast food sector, the influence of taxation and government regulation on
financial development is not as strong compared with the rest of the restaurant
business, particularly restaurants licensed to serve alcohol.
Finnish consumers are still spending a considerably smaller proportion of their
income on restaurant dining than consumers in most of the countries of
comparison. Thus, we have reason to believe that dining at restaurants will
increase in the next few years. MaRa has estimated that fast food restaurants
will be well-positioned for growth, particularly regarding staff restaurants, in
which the growth of sales is forecast to slow down or even turn negative.
According to MaRa's trend survey, rising phenomena in the restaurant business
include fast dining, leisure-time dining, hamburgers and pizza, as well as the
increased importance of the quality of food. The survey shows that hamburgers
and pizza, previously classified as 'fast food', have an increasingly important
role also when it comes to dinner as well as lunch dining.
We believe that the financial development of the restaurant business and
consumer trends support Kotipizza Group's investment in the fast casual concept,
that is, restaurants that offer in a restaurant environment.
The Group estimates for the full financial year that the restaurant chain sales
will grow by approximately five (5) percent as compared to the previous
financial year and that comparable EBITDA will grow as compared to the previous
year.
ACCOUNTING POLICIES
Kotipizza Group's unaudited interim report for the twelve-month period ending
31 January 2017, including the audited comparison figures for the nine-month
period ending 31 January 2016, have been prepared according to IAS 34 and
applying the same accounting principles that were used in the previous audited
full year financial statements.
SUMMARY OF THE FINANCIAL STATEMENT AND NOTES
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-------------------------------------------
000 € 000 € 000 € 000 €
Continuing operations
Net sales 18 407 14 605 68 737 56 370
Other income 48 58 96 126
Change in inventory of raw
materials and finished goods
(+/-) 436 -285 -3 458
Raw materials and finished
goods (-) -14 521 -11 292 -52 872 -45 106
Employee benefits/expenses (-) -1 139 -839 -3 887 -3 605
Depreciations (-) -240 -302 -978 -735
Impairments (-) - -17 - -17
Other operating expenses (-) -1 894 -1 082 -5 846 -4 056
-------------------------------------------
Operating profit 1 098 846 5 246 3 435
Finance income 11 9 35 28
Finance costs -205 -191 -812 -3 011
-------------------------------------------
Loss / profit before taxes from
continuing operations 904 664 4 469 452
Income taxes -238 145 -1 005 -124
-------------------------------------------
Loss / profit for the period
from continuing operations 666 809 3 464 328
-------------------------------------------
Discontinued operations
Loss after tax for the period
from discontinued operations - - - -113
-------------------------------------------
Loss / profit for the period 666 809 3 464 215
-------------------------------------------
Earnings per share, EUR:
Basic, profit for the period
attributable to ordinary equity
holders of the parent (no
dilutive instruments) 0,10 0,13 0,55 0,05
Earnings per share for continuing operations, EUR:
Basic, profit for the period
attributable to ordinary equity
holders of the parent (no
dilutive instruments) 0,10 0,13 0,55 0,08
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
------------------------------------------
000 € 000 € 000 € 000 €
Profit (loss) for the period) 666 809 3 464 215
Other comprehensive income:
Other comprehensive income to be
reclassified to profit or loss in
subsequent periods:
Cash flow hedges 56 -71 69 -367
Taxes related to other comprehensive
income -11 -59 -14 -73
Net other comprehensive income to be 45 -57 56 -294
reclassified to profit or loss in ------------------------------------------
subsequent periods
Other comprehensive income for the 45 -57 56 -294
period, net of tax ------------------------------------------
Total comprehensive income for the
period, net of tax 710 752 3 520 -79
------------------------------------------
Attributable to:
Owners of the company 730 756 3 597 -45
Non-controlling interest -19 -4 -77 -34
------------------------------------------
711 752 3 520 -79
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31.1.2017 31.1.2016
Assets 000 € 000 €
Non-current assets
Property, plant and equipment 1 138 1 002
Goodwill 35 819 35 819
Intangible assets 2 321 2 118
Non-current financial assets 2 2
Non-current receivables 872 783
Deferred tax assets 488 289
--------------------
40 641 40 013
Current assets
Inventories 3 087 3 385
Trade and other receivables 5 761 4 945
Current tax receivables 4 58
Cash and cash equivalents 9 650 8 099
--------------------
18 502 16 487
Assets classified as held for sale 13 19
Total Assets 59 156 56 519
--------------------
31.1.2017 31.1.2016
--------------------
000 € 000 €
Equity and liabilities
Share capital 80 80
Translation differences 27 595 29 818
Fund for invested unrestricted equity 2 989 -624
--------------------
Retained earnings 30 664 29 274
Non-controlling interests -91 -14
--------------------
Total equity 30 573 29 260
Non-current liabilities
Interest bearing loans and borrowings 15 829 16 363
Financial liabilities at fair value through profit or loss 298 367
Other non-current liabilities 2 745 2 462
Deferred tax liabilities 66 54
--------------------
18 938 19 246
Current liabilities
Interest bearing loans and borrowings 1 165 1 041
Trade and other payables 8 480 6 882
Provisions - 90
Current tax liabilities - -
--------------------
9 645 8 013
Liabilities related to assets held for sale - -
Total liabilities 28 583 27 259
--------------------
Total shareholders' equity and liabilities 59 156 56 519
--------------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to owners of the company
-------------------------------------------------------------
Fund for Retai- Non-
invested ned control-
Share unrestricted earn- ling Total
EUR THOUSAND capital equity ings Total interest equity
1 February 2016 80 29 818 -624 29 274 -14 29 260
Result for the
period - - 3 541 3 541 -77 3 506
Other
comprehensive
income - - 56 56 - 14
-------------------------------------------------------------
Total
incomprehensive
income for the
period - - 3 597 3 597 -77 3 520
Transactions with
owners
Management
incentive
scheme - - 16 16 - 16
Dividends - -2 223 - -2 223 - -2 223
-------------------------------------------------------------
Transactions with
owners total - -2 223 16 -2 207 -2 207
31 January 2017 80 27 595 2 989 30 664 -91 30 573
-------------------------------------------------------------
Equity attributable to owners of the company
-------------------------------------------------------------
Fund for Retai- Non-
invested ned control-
Share unrestricted earn- ling Total
EUR THOUSAND capital equity ings Total interest equity
1 February 2015 80 5 362 -579 4 863 - 4 863
Result for the
period - - 249 249 -34 215
Other
comprehensive
income - - -294 -294 - -294
-------------------------------------------------------------
Total
incomprehensive
income for the
period - - -45 -45 -34 -79
Transactions with
owners
Share issue - 25 501 - 25 501 20 25 521
Initial public
offering costs -1 045 - -1 045 - -1 045
-------------------------------------------------------------
Transactions with
owners total 24 456 - 24 456 20 24 476
31 January 2016 80 29 818 -624 29 274 -14 29 260
-------------------------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
2/16-1/17 2/15-1/16
Operating activities 000 € 000 €
Profit before tax 4 469 452
Loss for discontinued operations - -140
Adjustments to reconcile profit before tax to net cash
flows
Depreciation of property, plant and equipment 453 278
Depreciation and impairment of intangible assets 525 474
Other non-cash items 16 -
Gain on disposal of property, plant and equipment -70 -50
Finance income -35 -28
Finance costs 812 3 011
Change in working capital
Change in trade and other receivables (+/-) -557 578
Change in inventories (+/-) 299 -428
Change in trade and other payables (+/-) 1 443 -50
Change in provisions (+/-) -90 90
Interest paid (-) -816 -5 058
Interest received 35 28
Income tax paid (-) -1 206 172
--------------------
Net cash flows from operating activities 5 278 -671
Investing activities
Acquisition of subsidiaries - 20
Investments for tangible assets (-) -121 -611
Investments for non-tangible assets (-) -728 -1 364
Repayment for loan assets - -
Proceeds from sale of assets-held-for-sale - -
Sale of property, plant and equipment 400 185
--------------------
Net cash flows used in investing activities -449 -1 770
Financing activities
Funds received from the share issue -2 223 24 194
Loans withdrawal - 17 000
Loans repayments (-) -850 -36 074
Finance lease payments (+/-) -207 219
Net cash flow used in financing activities -3 280 5 339
Net change in cash and cash equivalents 1 550 2 898
Cash and cash equivalents at 1 February 8 100 5 201
--------------------
Cash and cash equivalents at 31 October 9 650 8 099
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1. SEGMENT INFORMATION
The segment information is presented in accordance with the previous financial
statements.
KOTIPIZZA SEGMENT
-------------------------------------------------------------------------
EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-------------------------------------------------------------------------
Comparable net sales 3 247 3 035 12 894 11 784
Net sales 4 202 3 035 15 051 11 784
Comparable gross margin/EBITDA 1 552 1 379 6 633 5 465
Depreciation and impairments -148 -269 -589 -584
Comparable EBIT 1 404 1 110 6 044 4 881
Reported gross margin/EBITDA 1 499 1 379 6 517 5 196
Reported EBIT 1 352 1 110 5 929 4 612
-------------------------------------------------------------------------
FOODSTOCK SEGMENT
-------------------------------------------------------------------------
EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-------------------------------------------------------------------------
Comparable net sales 14 165 11 396 53 198 44 096
Net sales 14 165 11 396 53 198 44 096
Comparable gross margin/EBITDA 252 218 1 596 964
Depreciation and impairments -38 -28 -143 -113
Comparable EBIT 214 190 1 453 851
Reported gross margin/EBITDA 239 218 1 566 849
Reported EBIT 200 190 1 423 736
-------------------------------------------------------------------------
CHALUPA SEGMENT
-------------------------------------------------------------------------
EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-------------------------------------------------------------------------
Comparable net sales 41 165 487 443
Net sales 41 165 487 443
Comparable gross margin/EBITDA -13 1 -161 -66
Depreciation and impairments -1 -9 -27 -18
Comparable EBIT -14 -8 -188 -84
Reported gross margin/EBITDA -17 1 -169 -66
Reported EBIT -18 -8 -196 -84
-------------------------------------------------------------------------
OTHERS SEGMENT
-------------------------------------------------------------------------
EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-------------------------------------------------------------------------
Comparable net sales 0 9 0 47
Net sales 0 9 0 47
Comparable gross margin/EBITDA -261 -433 -1 342 -1 337
Depreciation and impairments -53 -13 -219 -37
Comparable EBIT -314 -446 -1 561 -1 374
Reported gross margin/EBITDA -383 -433 -1 690 -1 792
Reported EBIT -436 -446 -1 909 -1 829
-------------------------------------------------------------------------
ALL SEGMENTS TOGETHER
-------------------------------------------------------------------------
EUR THOUSAND 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-------------------------------------------------------------------------
Comparable net sales 17 452 14 605 66 580 56 370
Net sales 18 407 14 605 68 737 56 370
Comparable gross margin/EBITDA 1 530 1 165 6 726 5 026
Depreciation and impairments -240 -319 -978 -752
Comparable EBIT 1 290 846 5 747 4 274
Reported gross margin/EBITDA 1 338 1 165 6 225 4 187
Reported EBIT 1 098 846 5 246 3 435
-------------------------------------------------------------------------
NOTE 2. NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS
The non-current assets held for sale and discontinued operations were related to
Kotipizza segment's Russian operations, Domi-pizzapalat, the sale of franchising
segment's 55 Burger, Cola, Fries concept and the divestment of the financial
management services segment. Selling price of the both divested businesses,
financial management services and 55 Burger, Cola, Fries concept, was 1 euro.
31/01/2017 31/01/2016
----------------------
000 € 000 €
Net sales - 32
Other operating income - -
Depreciation - -
Expenses - -144
Operating loss (EBIT) - -112
Finance costs - -
Capital loss related to discontinued operations - -28
----------------------
Loss for the period from a discontinued operation before
tax - -140
Tax impact - 27
----------------------
Loss for the period from the discontinued operations - -113
Earnings per share for discontinued operations, EUR:
Basic, profit for the period attributable to ordinary
equity holders of the parent
(no dilutive instruments) - -0,03
The major classes of assets and liabilities related to
discontinued operations:
31/01/2017 31/01/2016
----------------------
Assets 000 € 000 €
Inventories - -
Trade receivable and other receivables 13 19
----------------------
Assets related to discontinued operations 13 19
Liabilities
Received collaterals - -
Other liabilities - -
Accrued expenses - -
Liabilities related to discontinued operations - -
Cash flows related to discontinued operations are not
reported separately, and due to this, the information
cannot be accurately reported.
NOTE 3. RELATED PARTY TRANSACTIONS
Parties are considered to be related when a party has control or significant
influence over the other party relating to decision-making in connection to its
finances and business. The Group's related parties include the parent company,
subsidiaries, members of the board of directors and management board, managing
director and their family members. The key management comprises the members of
the management board. The table below sets forth the total amounts of related
party transactions carried out during the period. The terms and conditions of
the related party transactions correspond terms and conditions applied to
transactions between independent parties.
Amounts Purchases
owed to from Outstanding Sales to Outstanding
Interest related related trade related trade
paid parties parties payables parties receivables
-----------------------------------------------------------------
000 € 000 € 000 € 000 € 000 € 000 €
Key
management of
the group
2/16-1/17 - - 31 - 2 -
2/15-1/16 - - 94 3 536 8
Other related
parties
2/16-1/17 - - 437 74 - -
2/15-1/16 - - 632 46 - -
Controlling
entities
2/16-1/17 - - - - - -
2/15-1/16 156 - - - - -
Companies
controlled by
the members
of the Board
2/16-1/17
2/15-1/16 - - 3 - - -
NOTE 4. EMPLOYEE BENEFITS EXPENSE
All employee benefits expenses are included in administrative (fixed) expenses.
2/16-1/17 2/15-1/16
--------------------
000 € 000 €
Wages and salaries 3 173 2 981
Social security costs 132 103
Pension costs (defined contribution plans) 582 521
--------------------
Total employee benefits expense 3 887 3 605
NOTE 5. CONTINGENT LIABILITIES
Commitments 31/10/2016 31/10/2015
000 € 000 €
Leasing commitments 238 158
Secondary commitments - -
Rental guarantees 760 644
Bank guarantees 420 420
Rental commitments for premises 3 633 3 073
Loans from financial institutions 15 963 16 813
Guarantees for other than Group companies 3 422
Guarantees
Pledged deposits 146 352
Business mortgages 17 500 17 500
Guarantees 12 20
Pledged shares, book value 19 984 29 637
General guarantee for other Group companies unlimited unlimited
NOTE 6: ALTERNATIVE PERFORMANCE MEASURES (APMs)
New ESMA (European Securities and Markets Authority) guidelines on Alternative
Performance Measures (APMs) became effective for the financial year 2016.
Kotipizza Group presents APMs to reflect the underlying business performance and
to enhance comparability between financial periods. APMs should not be
considered as a substitute for measures of performance in accordance with the
IFRS. APMs used by Kotipizza Group are listed and defined in this note.
CHAIN-BASED NET SALES
Chain-based net sales is the total combined net sales of the company's
franchisees, based on which the company's franchising fees are invoiced monthly.
COMPARABLE NET SALES:
Net sales items affecting comparability
EUR thousand 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
------------------------------------------------------------------------
Net sales 18 407 14 605 68 737 56 370
Items affecting comparability -955 0 -2 157 0
------------------------------------------------------------------------
Comparable net sales 17 452 14 605 66 580 56 370
------------------------------------------------------------------------
Items affecting comparability in 11/16-1/17 and 2/16-1/17 relate to advertising
and marketing fund flows of Kotipizza's Franchisee Co-operative, which pass
through Kotipizza division's P&L without result effect. A separate stock
exchange release on Kotipizza's Marketing Co-operative's change into Franchisee
Co-operative was given on 30 May 2016.
COMPARABLE EBIT:
EBIT- items affecting comparability
EUR thousand 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
------------------------------------------------------------------------
EBIT 1 098 846 5 246 3 435
Items affecting comparability 191 0 501 839
------------------------------------------------------------------------
Comparable EBIT 1 290 846 5 747 4 274
------------------------------------------------------------------------
Reported EBIT in 11/16-1/17 included EUR 293 thousand and in 2/16-1/17 EUR 602
thousand of items affecting comparability (calculatory, non-cash), which were
related to incentive program introduced on 6 May 2016 and other incentive
schemes within the group.
The reported EBIT in 2/15-1/16 included EUR 839 thousand of items affecting
comparability. Costs amounting to EUR 229 thousand related to initial public
offering of company's shares to the Nasdaq OMX Helsinki Oy's stock exchange and
EUR 495 thousand related to closing permanently down Kotipizza Oyj's previous
headquarters in Vaasa. These items had a cash flow effect. In addition, 2-10/15
reported EBIT included EUR 115 thousand non-cash deferral error related to
Foodstock's inventory as an item affecting comparability.
Items affecting comparability are material items or transactions, which are
relevant for understanding the financial performance of Kotipizza Group when
comparing profit of the current period with previous periods. These items can
include, but are not limited to, capital gains and losses, significant write-
downs, provisions for planned restructuring and other items that are not related
to normal business operations from Kotipizza Group's management view. Such items
are always listed in euros in Kotipizza Group's interim, half-year and full-year
financial reports for the whole Group and for the operating segments.
EBITDA
EBIT + depreciation
EUR thousand 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
-----------------------------------------------------------------------
EBIT 1 098 846 5 246 3 435
Depreciation and impairments 240 319 978 752
-----------------------------------------------------------------------
EBITDA 1 338 1 165 6 225 4 187
-----------------------------------------------------------------------
COMPARABLE EBITDA
EUR thousand 11/16-1/17 11/15-1/16 2/16-1/17 2/15-1/16
------------------------------------------------------------------------
EBIT 1 098 846 5 246 3 435
Depreciation and impairments 240 319 978 752
Items affecting comparability 191 0 501 839
------------------------------------------------------------------------
Comparable EBITDA 1 530 1 165 6 726 5 026
------------------------------------------------------------------------
Items affecting comparability have been detailed earlier in this Note in section
COMPARABLE EBIT.
COMPARABLE EBITDA OF NET SALES, %
Comparable EBITDA
-------------------* 100
Net sales
NET DEBT
Long term ja short term interest bearing debt - Cash and cash equivalents
EUR thousand 31.1.2017 31.1.2016
-----------------------------------------------------
Long term interest bearing debt 15 829 16 363
Short term interest bearing debt 1 165 1 041
Cash and cash equivalents -9 650 -8 099
-----------------------------------------------------
Net debt 7 344 9 305
-----------------------------------------------------
NET GEARING, %
Net debt
--------------* 100
Total equity
EQUITY RATIO, %
Total equity
--------------* 100
Total assets
In Helsinki on 21 March 2017
Kotipizza Group Oyj's Board of Directors
Further information: CEO Tommi Tervanen, tel. +358 207 716, and CFO Timo
Pirskanen, tel. +358 207 716 747
[]
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