WULFF GROUP PLC'S INTERIM REPORT FOR JANUARY 1 – SEPTEMBER 30, 2017

INTERIM REPORT  November 2, 2017 at 9.00 A.M.

Net sales declined and profitability decreased

This is a summary of Wulff Group Plc’s interim report for January-September 2017. Wulff Group’s interim report as a whole for January-September 2017 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.-30.9.2017 BRIEFLY

  • Net sales totalled EUR 41.1 million (43,5). Net sales decreased by 5.5%
  • EBITDA was EUR -0.0 million (0.7). Comparable EBITDA was EUR -0.0 million (0.5)
  • Operating profit (EBIT) was EUR -0.3 million (0.4). Comparable operating profit (EBIT) amounted to EUR -0.3 million (0.2)
  • Earnings per share (EPS) were EUR -0.07 (0.01)
  • Equity-to-assets ratio was 44.9% (31.12.2016: 50.5)

1.7.-30.9.2017 BRIEFLY

  • Net sales totalled EUR 12.2 million (13.4). Net sales decreased by 8.7%
  • EBITDA was EUR -0.0 million (0.4). Comparable EBITDA was EUR -0.0 million (0.4)
  • Operating profit (EBIT) was EUR -0.1 million (0.4). Comparable operating profit (EBIT) was EUR -0.1 million (0.3)
  • Earnings per share (EPS) were EUR -0.02 (0.02)  
  • The Board appointed Heikki Vienola as the new CEO after the resignation of CEO Kimmo Laaksonen    
  • Wulff adjusted its outlook for the comparable operating profit during the financial period: the comparable operating profit for 2017 will not reach the level of 2016  

WULFF GROUP’S CEO HEIKKI VIENOLA

“In 2017, we have invested in our competitiveness. The current development projects are important investments. The market situation has remained challenging for us, hence it is likely that we will not reach our target result and net sales. In this rapidly changing world, to better serve our customers in the way they want to be served, it is necessary to invest in development. For example, we need to constantly develop our selection of workplace products, cafeteria and facility management products, and cleaning and hygiene supplies. Wulff’s customers know and count on the fact that they can acquire the broadest selection of products for the workplace from us, irrespective of their operating field. For more and more companies, the wellbeing of their personnel and workplace ergonomics are growing in importance: companies want to obtain these services as easily as basic products. Wulff offers the same cost-effective and time-saving channels for everything that you need at your workplace, now and in the future.“

GROUP’S NET SALES AND RESULT PERFORMANCE

In January-September 2017 net sales totalled EUR 41.1 million (43.5), and EUR 12.2 million (13.4) million in the third quarter. Net sales decreased by 5.5% in January-September and 8.7% in the third quarter. The decline in net sales is a result of lost contracts and trimming of the product range. Wulff continues to develop its range of workplace products.

In January-September 2017 the gross margin amounted to EUR 13.9 million (15.2) being 33.9% (35.0), and EUR 4.2 million (4.6) in the third quarter being 34.2% (34.0). The gross margin percent decreased due to write-downs of inventories that were larger than during the previous year. Furthermore, the gross margin was affected by the concentration of demand on low margin products during the first half-year period. The continuous streamlining of procurement processes is one of Wulff’s most important measures to improve profitability.  

In January-September 2017 employee benefit expenses amounted to EUR 9.0 million (9.4), 22.0% (21.6) of net sales and EUR 2.7 million (2.5), 21.8% (19.0) of net sales in the third quarter. Other operating expenses amounted to EUR 5.0 million (5.5) in January-September 2017 being 12.2% (12.6) of net sales and EUR 1.6 million (1.7), 12.9% (12.5) of net sales in the third quarter. Employee benefit and other operating expenses were still affected by the implemented cost-saving measures. To improve its profitability, Wulff Group continues to examine its cost structure as part of ongoing reforms.

In January-September 2017 EBITDA was EUR -0.0 million (0.7) being -0.0% (1.6) of net sales, and EUR -0.0 million (0.4) in the third quarter. In January-September 2017 the comparable EBITDA amounted to EUR -0.0 million (0.5) and EUR -0.0 million (0.4) in the third quarter. 2016 EBITDA included a profit of EUR 0.2 million from the sales of car stock in January-September. 2017 EBITDA did not include items affecting comparability.

In January-September 2017 the operating profit (EBIT) amounted to EUR -0.3 million (0.4) being -0.7% (0.9) of net sales, and EUR -0.1 million (0.4) in the third quarter. In January-September 2017 the comparable operating profit (EBIT) amounted to EUR -0.3 million (0.2) and EUR -0.1 million (0.3) in the third quarter. The January-September 2016 operating profit included profit of EUR 0.2 million and EUR 0.1 million in the third quarter from the sales of car stock that affected comparability.

In January-September 2017 the financial income and expenses totalled (net) EUR -0.1 million (-0.2) including interest expenses of EUR -0.1 million (-0.1) and mainly currency-related other financial items (net) EUR -0.0 million (-0.1). In the third quarter, the financial income and expenses (net) totalled EUR -0.0 million (-0.1).

In January-September 2017 the result before taxes was EUR -0.4 million (0.2), and EUR -0.1 million (0.2) in the third quarter.

In January-September 2017 the net profit was EUR -0.5 million (0.1), and EUR -0.1 million (0.2) in the third quarter. Earnings per share (EPS) were EUR -0.07 (0.01) in January-September 2017, and EUR -0.02 (0.02) in the third quarter.

KEY FIGURES  

III   III   I-III   I-III   I - IV
EUR 1000 2017 2016 2017 2016 2016
Net sales 12 240 13 408 41 102 43 493 59 304
Change in net sales, % -8,7% -9,4% -5,5%   -13,4% -13,8%
EBITDA -39 365 -18   690 998
EBITDA margin, % -0,3% 2,7% 0,0%   1,6% 1,7%
Operating profit/loss -134 270 -308   376 583
Operating profit/loss margin, % -1,1% 2,0% -0,7%   0,9% 1,0%
Profit/Loss before taxes -134 200 -417   153 351
Profit/Loss before taxes margin, % -1,1% 1,5% -1,0%   0,4% 0,6%
Net profit/loss for the period attributable to equity holders of the parent company -121 153 -467   71 302
Net profit/loss for the period, % -1,0% 1,1% -1,1%   0,2% 0,5%
Earnings per share, EUR (diluted = non-diluted) -0,02 0,02 -0,07   0,01 0,05
Return on equity (ROE), % -1,1% 1,3% -4,3%   0,8% 2,5%
Return on investment (ROI), % -0,7% 1,4% -2,3%   1,4% 2,9%
Equity-to-assets ratio at the end of period, % 44,9% 48,0% 44,9%   48,0% 50,5%
Debt-to-equity ratio at the end of period 38,9% 33,0% 38,9%   33,0% 19,6%
Equity per share at the end of period, EUR * 1,60 1,75 1,60   1,75 1,78
Investments in non-current assets 96 114 413 116 319
Investments in non-current assets, % of net sales 0,8% 0,9% 1,0%   0,3% 0,5%
Treasury shares held by the Group at the end of period 79 000 79 000 79 000   79 000 79 000
Treasury shares, % of total share capital and votes 1,2% 1,2% 1,2%   1,2% 1,2%
Number of total issued shares at the end of period 6 607 628 6 607 628 6 607 628   6 607 628 6 607 628
Personnel on average during the period 199 213 198 218 214
Personnel at the end of period 199 211 199 211 203

* 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 market’s tight competition. Approximately half of the Group’s net sales come from other than euro-currency countries. Fluctuation of the currencies affect the Group’s net result; however, the effect of the fluctuation is expected to be moderate .

SUBSEQUENT EVENTS

The Group has not had any significant subsequent events after the reporting period.

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 in the long term. Wulff’s aim is to further improve the profitability of its operations. Wulff estimated that its 2017 comparable operating profit, which was 419 thousand euros, will increase. However, the Group decreased its estimate on 20.9.2017 for the rest of the year. According to the Group management’s forecast, it is likely that the comparable operating profit will not reach the level of 2016. In the industry, it is typical that the result and cash flow are generated in the last quarter.

In Vantaa on November 2, 2017

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   

Wulff enables working in environments where companies and entrepreneurs operate. We offer the industry’s most comprehensive product and service range that can help you create an office wherever you want it. What would you like? We offer our customers office supplies, facility management products, catering solutions, IT supplies, ergonomics, first aid, LED lighting solutions 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. 

About Us

WULFF – CREATING WORKPLACES Wulff enables working in environments where companies and entrepreneurs operate. Already, people work a lot away from the office: digitalization enables telework and at the same time, mobile work creates new requirements for working environments. How to ensure that people can work effectively, ergonomically, environmentally friendly – and exactly like they want to? Wulff has the answers. We offer the industry’s most comprehensive product and service range that can help you create an office wherever you want it. What would you like? We offer our customers office supplies, facility management products, catering solutions, IT supplies, ergonomics, first aid, LED lighting solutions and innovative products for worksites. Customers can also acquire international exhibition services from Wulff.

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