Fiskars year 2014: Continued good operational efficiency, weaker sales
Fiskars Corp. Financial Statement Release February 6, 2015 at 8:30 am EET
2014 in brief:
- Net sales decreased by 4% to EUR 767.5 million (2013: 798.6)
- Comparable net sales (currency neutral and excluding 2013 divested pottery business) decreased by 1%
- Operating profit (EBIT) decreased by 30% to EUR 42.7 million (61.0)
- Operating profit excluding non-recurring items decreased by 19% to EUR 59.6 million (73.8)
- Non-recurring profit from the sale and revaluation of Wärtsilä shares was EUR 676.0 million
- Cash flow from operating activities was EUR 87.0 million (81.0)
- Earnings per share were EUR 9.44 (1.14)
- Operative earnings per share (excl. the sale and revaluation of Wärtsilä shares and the change in fair value of the investment portfolio) were EUR 0.76 (1.14)
- The Board proposes a dividend of EUR 0.68 per share (EUR 0.67 paid in March 2014 and extra dividend of EUR 2.60 in December 2014)
- Outlook for 2015: full-year net sales are expected to increase from 2014 levels and operating profit excluding non-recurring items to be below 2014 levels due to increased investment into growth initiatives
Fourth quarter 2014 in brief:
- Net sales decreased by 4% to EUR 203.9 million (Q4 2013: 212.6)
- At comparable currency rates and excluding the pottery business divested in 2013, net sales decreased by 5%
- Operating profit (EBIT) decreased by 81% to EUR 2.3 million (11.7)
- Operating profit excluding non-recurring items decreased by 24% to EUR 10.7 million (14.0)
- Non-recurring costs amounted to EUR 8.4 million (2.3)
- Non-recurring profit from the sale and revaluation of Wärtsilä shares was EUR 676.0 million
- Earnings per share were EUR 8.77 (0.40)
- Operative earnings per share were EUR 0.09 (0.40)
- Cash flow from operating activities was EUR 47.9 million (40.6)
Fiskars President and CEO, Kari Kauniskangas:
“2014 was a milestone year for Fiskars – in addition to celebrating its 365th anniversary, the company took several significant strategic steps in its transformation. We ended the year with a new corporate structure and organization, including a separate organization for the Asia-Pacific region. In line with our growth strategy we launched our kitchen business internationally and expanded into watering with an acquisition. Strategically and financially, the most significant step was the divestment of the majority of our holdings in Wärtsilä, which released funds for our shareholders in the form of an extra dividend and for the company to be used for financing future growth over time.
Looking at 2014 from a sales perspective I am not satisfied with our performance, and the year ended with a dissatisfactory quarter. During the year there were factors outside of our control, such as currencies and weather conditions. However, we also faced challenges with availability in Europe in the early part of the year and in the US we had challenges in our outdoor business. Actions were initiated, and we saw improvements in the second half of the year. Despite the drop in sales volume, we maintained good operational efficiency and improved our gross margin.
In 2015, Fiskars expects the Group’s net sales to increase from the previous year. The majority of the increase is expected from the addition of the watering businesses and we also foresee growth in our comparable net sales.
Despite the overall economic uncertainty, Fiskars strong financial position and positive cash flow enable us to continue the determined execution of our strategy in 2015 to lay the foundation for our future international growth. We will ramp up our business and retail network in Asia, and the integration and turnaround of the newly acquired US watering business has started. In addition, we plan to increase investments in our brands in Europe. These strategically important efforts will increase our costs and, together with the amortization related to our five-year investment program, lead us to expect that our operating profit excluding non-recurring items for 2015 will be below 2014 levels.”
The full-year figures stated in this release are audited.
Group key figures
| EUR million | Q4 2014 | Q4 2013 | Change | 2014 | 2013 | Change |
| Net sales | 203.9 | 212.6 | -4% | 767.5 | 798.6 | -4% |
| Operating profit (EBIT) | 2.3 | 11.7 | -81% | 42.7 | 61.0 | -30% |
| Non-recurring items1) | -8.4 | -2.3 | 261% | -17.0 | -12.8 | 33% |
| EBIT excl. non-recurring items | 10.7 | 14.0 | -24% | 59.6 | 73.8 | -19% |
| EBITDA2) excl. non-recurring items | 18.3 | 21.9 | -16% | 86.9 | 98.1 | -11% |
| Share of profit from associated company | 19.1 | 30.0 | 50.8 | -41% | ||
| Net change in the fair value of investment portfolio | 27.9 | 27.9 | ||||
| Profit before taxes3) | 716.6 | 29.8 | 2302% | 786.7 | 108.3 | 626% |
| Profit for the period3) | 718.2 | 32.7 | 2096% | 773.3 | 94.0 | 723% |
| Operative earnings/share, EUR4) | 0.09 | 0.40 | -56% | 0.76 | 1.14 | -26% |
| Earnings/share, EUR5) | 8.77 | 0.40 | 2100% | 9.44 | 1.14 | 725% |
| Equity per share, EUR | 14.06 | 7.71 | 82% | |||
| Cash flow from oper. act.6) | 47.9 | 40.6 | 18% | 87.0 | 81.0 | 7% |
| Equity ratio, % | 73% | 61% | ||||
| Net gearing, % | 11% | 24% | ||||
| Capital expenditure | 7.4 | 8.5 | -14% | 35.0 | 37.5 | -6% |
| Personnel (FTE), average | 4,443 | 4,092 | 9% | 4,243 | 4,087 | 4% |
1)In Q4 2014 EMEA 2015 restructuring costs, writedowns and bargain purchase gain (badwill) and in 2013 EMEA 2015 restructuring costs and impairment charges
2)EBIT before depreciation, amortization, and impairment
3)Including non-recurring profit from the sale and revaluation of Wärtsilä shares of EUR 676.0 million on Oct 9, 2014
4)Excl. non-recurring profit from the sale and revaluation of Wärtsilä shares and the net change in the fair value of investment portfolio
5)Including EUR 8.25 from the sale and revaluation of Wärtsilä shares on Oct 9, 2014
6)Including a Wärtsilä dividend of EUR 26.9 million in 2014 and EUR 25.6 million in 2013
Full financial statement release
The full financial statement release is published as a pdf file attachment to this summary stock exchange release and is available on the company's web site at www.fiskarsgroup.com.
News conference:
An analyst and press conference on the fourth quarter and full year results will be held on February 6, 2015, at 10:00 am at the company’s headquarters, Fiskars Campus, Hämeentie 135 A, Helsinki. Presentation material will be available at www.fiskarsgroup.com.
FISKARS CORPORATION
Kari Kauniskangas
President and CEO
Further information:
- President and CEO Kari Kauniskangas, tel. +358 204 39 5500
- COO & CFO Teemu Kangas-Kärki, tel. +358 204 39 5703
Fiskars 365 – celebrating centuries of pride, passion and design. Every day.
Established in 1649 as an ironworks in a small Finnish village, Fiskars has grown to be a leading global supplier of consumer products for the home, garden and outdoors. Available in more than 60 countries, Fiskars products solve everyday problems, making daily home, garden and outdoor projects easier and more enjoyable through superior performance and design. Fiskars is listed on NASDAQ OMX Helsinki, and the company’s net sales were 768 million euro in 2014. The Group’s key international brands are Fiskars, Iittala and Gerber. www.fiskarsgroup.com