INTERIM REPORT MAY 3, 2018 at 9.00 A.M.
Profitability increased
This is a summary of Wulff Group Plc’s interim report for January-March 2018.
Wulff Group’s interim report as a whole is attached as a PDF file to this stock
exchange release and it is also available on the company’s website www.wulff
-group.com.
1.1.-31.3.2018 BRIEFLY
· Net sales totalled EUR 14.3 million (15.3), down by 7.0%.
· EBITDA and comparable EBITDA were EUR 0.4 million (0.2).
· Operating profit and comparable operating profit (EBIT) amounted to EUR 0.3
million (0.1).
· Earnings and comparable earnings per share (EPS) were EUR 0.02 (0.01).
· Equity-to-assets ratio was 46.6% (48.6).
· Kari Juutilainen, Jussi Vienola, and Kristina Vienola were elected as new
members to the Board of Directors. Ari Pikkarainen was elected as a member of
the Board of Directors and he continues as the Chairman of the Board.
· The outlook for the comparable operating profit remains the same; Wulff
estimates the comparable operating profit 2018 to grow.
WULFF GROUP’S CEO HEIKKI VIENOLA
”Wulff’s year has begun well – thank you to our customers, cooperation partners
and to our employees. Improving our profitability is important. By continuing
our good progress we will enable investments in strategic operations and grow
our net sales. Our goal is to offer our customers the perfect working day. We
make working environments and workplaces more comfortable, healthier, safer,
more enjoyable, more active and more diverse. We will ensure that everyday life
and purchasing at the workplace run smoothly and people feel well at work. We
will bring more and more environmentally friendly and sustainable products and
domestic products to our customers. It is great that our customers value the
meanings of products and services and the effect they have on the environment.
Products do not just solve practical problems, they have an impact. For example,
this shows in the sales of our third-best selling workplace product, coffee.
People value and buy fair trade coffee more and more. Our choices matter, and
with Wulff’s products, you can have a positive impact on the world.”
GROUP’S NET SALES AND RESULT PERFORMANCE
In January-March 2018 net sales totalled EUR 14.3 million (15.3). Net sales
decreased by 7.0% (-1.0) in January-March. The decline in net sales was impacted
by the seasonality of the fair business. The first quarter of the year has many
fair events that are only arranged every other year, in 2018 there are less
trade shows.
Due to the IFRS 15 standard adoption, fair projects of partial revenue
recognition from the last quarter 2017 are presented in the net sales for the
first quarter 2018 on the date of the fairs amounting to EUR 0.1 million, and
-0.1 million in purchase transactions.
In January-March 2018 the gross margin amounted to EUR 4.9 million (5.2) being
34.7% (34.0). The gross margin percent increased due to additional sales in fair
projects.
In January-March 2018 employee benefit expenses amounted to EUR 3.0 million
(3.2), and were at the same level as during the reference period when compared
to net sales, 21.1% (21.1). Other operating expenses amounted to EUR 1.6 million
(1.8) in January-March 2018 being 11.2% (11.6) of net sales. Due to the IFRS 9
Financial Instruments standard, the first quarter included an increase of credit
loss provision of -0.0 million. The implemented cost-saving measures had a
positive effect on the operating profit.
In January-March 2018 EBITDA and the comparable EBITDA amounted to EUR 0.4
million (0.2), 2.6% (1.6) of net sales. The operating profit (EBIT) and the
comparable operating profit (EBIT) amounted to EUR 0.3 million (0.1), 1.9% (0.9)
of net sales. The first quarters of 2018 and 2017 did not include items
affecting comparability.
In January-March 2018 the financial income and expenses totalled (net) EUR -0.1
million (-0.1) including interest expenses of EUR -0.0 million (-0.0) and mainly
currency-related other financial items and bank expenses (net) EUR -0.1 million
(-0.0).
In January-March 2018 the result before taxes was EUR 0.1 million (0.1), and the
operating result EUR 0.1 million (0.1). Earnings per share and comparable
earnings-per-share (EPS) were EUR 0.02 (0.01) in January-March 2018.
KEY FIGURES
+------------------------------------------+-----------+----------+-----------+
| |I |I |I-IV |
+------------------------------------------+-----------+----------+-----------+
|EUR 1000 |2018 |2017 |2017 |
+------------------------------------------+-----------+----------+-----------+
|Net sales |14 256 |15 332 |56 931 |
+------------------------------------------+-----------+----------+-----------+
|Change in net sales, % |-7.0% |-1.0% |-4.0% |
+------------------------------------------+-----------+----------+-----------+
|EBITDA* |367 |239 |461 |
+------------------------------------------+-----------+----------+-----------+
|EBITDA margin, %* |2.6% |1.6% |0.8% |
+------------------------------------------+-----------+----------+-----------+
|Operating profit/loss* |264 |141 |74 |
+------------------------------------------+-----------+----------+-----------+
|Operating profit/loss margin, %* |1.9% |0.9% |0.1% |
+------------------------------------------+-----------+----------+-----------+
|Profit/Loss before taxes |147 |85 |-247 |
+------------------------------------------+-----------+----------+-----------+
|Profit/Loss before taxes margin, % |1.0% |0.6% |-0.4% |
+------------------------------------------+-----------+----------+-----------+
|Net profit/loss for the period |132 |50 |-193 |
|attributable to equity holders of the | | | |
|parent company | | | |
+------------------------------------------+-----------+----------+-----------+
|Net profit/loss for the period, % |0.9% |0.3% |-0.3% |
+------------------------------------------+-----------+----------+-----------+
|Earnings per share, EUR (diluted = non |0.02 |0.01 |-0.03 |
|-diluted) | | | |
+------------------------------------------+-----------+----------+-----------+
|Return on equity (ROE), % |1.2% |0.5% |-2.0% |
+------------------------------------------+-----------+----------+-----------+
|Return on investment (ROI), % |1.2% |0.7% |-1.1% |
+------------------------------------------+-----------+----------+-----------+
|Equity-to-assets ratio at the end of |46.6% |48.6% |47.0% |
|period, % | | | |
+------------------------------------------+-----------+----------+-----------+
|Debt-to-equity ratio at the end of |29.5% |24.8% |19.8% |
|period | | | |
+------------------------------------------+-----------+----------+-----------+
|Equity per share at the end of period, |1.64 |1.79 |1.64 |
|EUR ** | | | |
+------------------------------------------+-----------+----------+-----------+
|Investments in non-current assets |193 |215 |429 |
+------------------------------------------+-----------+----------+-----------+
|Investments in non-current assets, % of |1.4% |1.7% |0.8% |
|net sales | | | |
+------------------------------------------+-----------+----------+-----------+
|Treasury shares held by the Group at the|79 000 |79 000 |79 000 |
|end of period | | | |
+------------------------------------------+-----------+----------+-----------+
|Treasury shares, % of total share |1.2% |1.2% |1.2% |
|capital and votes | | | |
+------------------------------------------+-----------+----------+-----------+
|Number of total issued shares at the end|6 607 628|6 607 628 |6 607 628|
|of period | | | |
+------------------------------------------+-----------+----------+-----------+
|Personnel on average during the period |194 |203 |198 |
+------------------------------------------+-----------+----------+-----------+
|Personnel at the end of period |192 |195 |195 |
+------------------------------------------+-----------+----------+-----------+
*The presentation of the Consolidated Statement of Income has been changed in
the first quarter of 2018 in such a way that bank charges have been classified
as financial expenses instead of other operating expenses. The reference period
has been adjusted to correspond to the new reporting convention: EUR 0.0 million
has been moved from other operating expenses to financial expenses for Q1/2017
which affects EBITDA and operating profit. EUR 0.1 million has been moved from
other operating expenses to financial expenses for 2017, which affects the
EBITDA margin by +0.2% and operating profit/loss margin by +0.1%.
** Equity attributable to the equity holders of the parent company / Number of
shares excluding the acquired own shares.
RISKS AND UNCERTAINTIES IN THE NEAR FUTURE
The demand for office supplies is strongly affected by the general economic
development and the industry’s tight competition. Business operations are also
affected by normal business risks such as the success of the Group’s strategy
and operative risks stemming from the personnel, logistics and IT environments.
Approximately half of the Group’s net sales come from other than euro-currency
countries. Fluctuation of the currencies affects the Group’s net result and
balance sheet.
SUBSEQUENT EVENTS
Part of the Group’s loan agreements have covenants concerning the equity-to
-assets ratio and the interest-bearing liabilities/operating margin. Covenants
are reported yearly at the end of financial year. At the end of the financial
year 31.12.2017, the interest-bearing liabilities/operating margin covenant was
breached due to the negative result. The Group’s management negotiated with the
financier at the end of 2017 and due to the breach of covenant the financier
collected a one-off compensation after the 1.1.-31.3.2018 reporting period. The
Group has not had any other significant subsequent events.
MARKET SITUATION AND FUTURE OUTLOOK
Wulff is the most significant Nordic player in its field. Wulff creates
workplaces and its mission is to help corporate customers to succeed in their
own business by providing them with leading-edge products and services in a way
best suitable to them. Wulff is prepared to carry out new strategic acquisitions
and as a listed company, Wulff is in a good position to be a more active player
than its competitors.
The developing economic situation will enable Wulff’s business to develop
positively. Wulff’s aim is to further improve the profitability of its
operations and estimates that the comparable operating profit 2018 will grow. In
the industry, it is typical that the result and cash flow are generated in the
last quarter.
WULFF GROUP PLC’S FINANCIAL REPORTING AND ANNUAL GENERAL MEETING 2018
Wulff Group Plc will release the following financial reports in 2018:
Interim Report, January-June 2018 Thursday August 2, 2018
Interim Report, January-September 2018 Thursday November 1, 2018
In Vantaa on May 3, 2018
WULFF GROUP PLC
BOARD OF DIRECTORS
Further information:
CEO Heikki Vienola
tel. +358 300 870 414 or +358 50 65 110
e-mail: heikki.vienola@wulff.fi
DISTRIBUTION
NASDAQ OMX Helsinki Oy
Key media
www.wulff-group.com
A better world – one workplace at a time. Wulff’s goal is a perfect workday! We
enable better working environments and create workplaces, wherever you are. We
offer the industry’s most comprehensive product and service range that can help
you create an office wherever you want it. More comfortable, healthier, safer,
more enjoyable, more active and more diverse? How do you want to better you
workday and working environment? Wulff has the solution. We offer our customers
office supplies, facility management products, catering solutions, IT supplies,
ergonomics, first aid, air purifiers, and innovative products for worksites.
Customers can also acquire international exhibition services from Wulff. In
addition to Finland, Wulff operates in Sweden, Norway, and Denmark. Check out
our products and services at wulff.fi.