FISKARS FINANCIAL STATEMENT RELEASE 2017: Increase in both comparable net sales and comparable EBITA

Fiskars Corporation
Financial Statement Release
February 7, 2018 at 8:30 a.m. EET

FISKARS FINANCIAL STATEMENT RELEASE 2017: Increase in both comparable net sales and comparable EBITA

This release is a summary of the Fiskars Corporation’s fourth quarter of 2017 and Financial Statement Release 2017 published today. The complete Financial Statement Release 2017 with tables is attached to this release as a pdf-file. It is also available at http://fiskarsgroup.com/investors/reports-presentations/interim-reports and on the company website at www.fiskarsgroup.com. Investors should not rely on summaries of our financial reports only, but should review the complete Financial Statement Release with tables.

Fourth quarter 2017 in brief:

• Net sales decreased by 4.4% to EUR 319.2 million (Q4 2016: 334.1)
• Comparable net sales¹⁾ decreased by 0.2%
• Comparable²⁾ EBITA decreased by 2% to EUR 35.4 million (36.3)
• EBITA increased to EUR 30.6 million (28.1)
• Cash flow from operating activities before financial items and taxes amounted to EUR 103.5 million (77.5)
• Earnings per share (EPS) were EUR -0.56 (0.51). Operative earnings per share³⁾ totaled EUR 0.21 (0.23)

January–December 2017 in brief:

• Net sales decreased by 1.6% to EUR 1,185.5 million (2016: 1,204.6)
• Comparable net sales¹⁾ increased by 1.5%
• Comparable²⁾ EBITA increased by 11% to EUR 119.0 million (107.1)
• EBITA increased to EUR 113.2 million (96.7)
• Cash flow from operating activities before financial items and taxes amounted to EUR 130.5 million (120.7)
• Earnings per share (EPS) were EUR 2.04 (0.78). Operative earnings per share³⁾ totaled EUR 0.81 (0.56)
• The Board of Directors proposes a dividend of EUR 0.72 per share, to be paid in two installments of EUR 0.36 each, in March and September 2018

Outlook for 2018:

In 2018, Fiskars expects the Group’s comparable net sales¹⁾ and comparable²⁾ EBITA to increase from 2017.

President and CEO, Fiskars, Jaana Tuominen:

“The year 2017 was marked by many changes at Fiskars. We took a step for­ward towards fulfilling our global ambition and shifted from a region-based organization to form two global Strategic Business Units, Living and Functional, and a unified supply chain. We continued to improve our competitiveness with several initiatives, and the outcome of these initiatives supported our profitability already in 2017. Overall, I was pleased with our financial performance, as Fiskars Group increased its net sales, excluding net sales of businesses divested in 2016, and comparable EBITA during 2017. We made progress during the year, however we also experienced challenges in some markets.

Comparable net sales in the Living segment decreased year-on-year, impacted primarily by the negative development in the U.S. and Australia. The Scandinavian Living business consistently delivered during the year and improved its net sales and comparable EBITA also during the fourth quarter. The Scandinavian Living business exceeded our expectations and closed the year with a strong performance by the Iittala, Royal Copenhagen and Arabia brands. The English & Crystal Living business faced challenges throughout the year, especially as the transformation of the retail sector has continued mainly in the U.S. In addition, we have discontinued collaboration with select customers in the U.S., which has negatively affected our topline, however we expect this to positively contribute to our gross margin and brand value. With Ulla Lettijeff, the newly appointed President of SBU Living, and her team, we will continue to revitalize the positioning of our English & Crystal Living brands, including Waterford, Wedgwood, Royal Albert and Royal Doulton, while the improvement of operational excellence remains a high priority in 2018.

The Functional business made solid progress during the year, increasing the comparable net sales and comparable EBITA also during the fourth quarter. The performance in the fourth quarter was supported by increased sales to our existing customers as well as the scissors and hardware categories. Net sales decreased in the Outdoor business, primarily due to the challenges in the knife category and sporting goods sector. 

We are gaining further traction from our transformation programs, and today, we operate more efficiently than before. We have focused on removing internal complexities, aligning our ways of working and consistently reducing the number of stock keeping units (SKUs), enabling us to better focus on our core offering and increasing the value of our brands. This work will continue in the future.

We have proceeded on our strategic journey, and are progressing towards our long-term financial targets having improved the EBITA margin in 2017. In 2018, we expect to continue the profitable growth and increase our comparable net sales and comparable EBITA from 2017. 

Supported by the newly announced Fiskars Group Leadership Team, I look forward to driving Fiskars forward and creating value for our stakeholders. I’m proud of the Fiskars team, our passion for the brands and our commitment to meeting and exceeding consumers’ expectations – making the everyday extraordinary.”

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¹⁾ In 2017, using comparable exchange rates, excluding the divested Spring USA (September 2016) and the divested container gardening businesses in the U.S. (January 2016) and Europe (December 2016). In the outlook for 2018, comparable net sales excludes the impact of exchange rates, acquisitions and divestments
²⁾ Items affecting comparability in EBITA include items such as restructuring costs, impairment or provisions charges and releases, integration related costs, and gain and loss from the sale of businesses
³⁾ Operative earnings per share do not include net changes in the fair value of the investment portfolio and dividends received

Group key figures

¹⁾ Using comparable exchange rates, excluding the divested Spring USA (September 2016) and the divested container gardening businesses in the U.S. (January 2016) and Europe (December 2016)
²⁾ In Q4 2017, items affecting comparability consisted mainly of net cost related to the Alignment program, the Supply Chain 2017 program and costs related to the divestment of the European container gardening business. In Q4 2016, items mainly consisted of costs related to the Alignment program
³⁾ Excluding net change in the fair value of the investment portfolio and dividends received. The comparison period has been restated to also exclude the exchange rate gains related to the investment portfolio

CHANGES IN FISKARS REPORTING IN 2018

Based on the new IFRS 9 standard that Fiskars adopted from January 1, 2018 onwards, Fiskars Group will record the change in fair value of the Wärtsilä holding in other comprehensive income instead of recognizing fair value changes in income statement.

Compared to the previous reporting principle, this will transfer the change in fair value of such investments from the income statement to other comprehensive income including deferred taxes. The change will not impact the treatment of those items' balance sheet classification or dividends in the income statement.

From Q1 2018 onwards, Fiskars will not separately report the operative earnings per share, which previously has excluded the net change in the fair value of the investment portfolio and dividends received.

More information on the change is explained in the accounting principles section of this Financial Statement Release.

FISKARS CORPORATION

Jaana Tuominen
President and CEO

Further information:

• President and CEO Jaana Tuominen, tel. +358 204 39 5500
• CFO Sari Pohjonen, tel. +358 204 39 5773
• Corporate Communications, tel. +358 204 39 5031, communications@fiskars.com

Analyst and media conference
A presentation for analysts and media on the fourth quarter and full year 2017 results will be held on February 7, 2018 at 10:00 a.m. at the company’s headquarters, Fiskars Campus, Hämeentie 135 A, Helsinki. Presentation materials will be available at www.fiskarsgroup.com.

A conference call and live webcast for analysts and investors will be held on the same day at 11:30 a.m. (EET). The conference call will be held in English. To participate in the conference call please dial in 5-10 minutes prior to the start of the conference. Questions can be asked in English after the presentation.

International dial-in number: +44 (0)1452555566
Denmark: +45 32 727625
Finland: +358 9 23195187
France: +33 (0)176742428
Germany: +49 (0)6922224918
Norway: +47 21563013
Sweden: +46 (0)8 50336434
USA: +1 6315107498

Conference ID: 8289037

The presentation can be followed as a live webcast at: https://engage.vevent.com/rt/fiskars/index.jsp?seid=36

An on-demand version of the webcast will be available on the company website later the same day. Personal details gathered during the event will not be used for any other purpose.
 

Fiskars – Making the everyday extraordinary
Fiskars serves consumers and customers around the world with globally recognized brands including Fiskars, Gerber, Iittala, Royal Copenhagen, Waterford, and Wedgwood. Building on our mission to create a family of iconic lifestyle brands, Fiskars’ vision is to create a positive, lasting impact on our quality of life. Please visit www.fiskarsgroup.com for more information.