Nokian Tyres plc Financial Statement Release 2021: Record high sales with improved profit
Nokian Tyres plc Financial Statement Release 2021, February 8, 2022 at 2:00 p.m.
This release is a summary of Nokian Tyres’ Financial Statement Release 2021. The complete report is attached to this release. It is also available on the company website at www.nokiantyres.com/company/investors/.
October–December 2021
- Net sales were EUR 512.6 million (413.4 in October−December 2020) and grew by 24.0%. With comparable currencies, net sales increased by 18.4%.
- Segments operating profit was EUR 88.0 million (80.1). Operating profit was EUR 53.0 million (71.4). EUR -35.0 million (-8.7) was booked as non-IFRS exclusions, including EUR -20.6 million impairment of goodwill and other assets.
- Segments earnings per share were EUR 0.49 (0.44). Earnings per share were EUR 0.27 (0.40).
- Cash flow from operating activities was EUR 492.6 million (429.0).
January–December 2021
- Net sales were EUR 1,714.1 million (1,313.8 in 2020) and grew by 30.5%. With comparable currencies, net sales increased by 29.7%.
- Segments operating profit was EUR 324.8 million (190.2). Operating profit was EUR 268.2 million (120.0). EUR -56.7 million (-70.2) was booked as non-IFRS exclusions, including EUR -21.0 million impairment of goodwill and other assets.
- Segments operating profit margin was 19.0% (14.5%).
- Segments earnings per share were EUR 1.84 (1.04). Earnings per share were EUR 1.49 (0.62).
- Segments ROCE was 15.8% (9.3%).
- Cash flow from operating activities was EUR 396.5 million (422.4).
- In September, Nokian Tyres announced its revised mid-term strategy and updated targets. In mid-term, net sales target is EUR 2 billion. Target for segments operating profit margin and segments ROCE is at the level of 20%.
- The Board of Directors proposes a dividend of EUR 1.32 (1.20) per share for the financial year 2021 to be paid in two instalments.
Guidance for 2022
In 2022, Nokian Tyres’ net sales with comparable currencies are expected to grow significantly and segments operating profit is expected to grow.
The global car and tire demand is expected to grow. The COVID-19 pandemic continues to cause uncertainties, including cost inflation and availability challenges, in the whole automotive value chain. In addition, current geopolitical situation causes uncertainties in 2022.
Jukka Moisio, President and CEO:
“Nokian Tyres’ team did an excellent job in an eventful year of 2021, delivering record high net sales and improved profit combined with strong cash flow and stronger market position in all key areas. This achievement builds a foundation to continue on the same path toward EUR 2 billion net sales and improved profit targets. I want to thank everyone at Nokian Tyres for making 2021 such a successful year.
In October–December 2021, tire demand continued on a high level. Our net sales with comparable currencies increased by 18.4%, driven by higher sales volume and increased Average Selling Price. Net sales grew in all our business units and areas. Segments operating profit improved due to net sales growth, and our fourth quarter cash flow was strong.
During the second half of 2021, we witnessed sharp increase in raw material and logistics costs. We responded to this with sales price increases. Inflationary pressures are expected to continue in 2022, which will require systematic price increases and careful cost control going forward.
Our large investment phase is completed, and we are well positioned for organic growth and strong financial results. New products as well as continuous improvements in operational and commercial activities will support future performance, and they will remain a key focus going into 2022. We will optimize investments and carefully manage capital employed and ensure it is used efficiently, which allows us to generate strong cash flow and reward shareholders.
Sustainability is a crucial part of our business. In 2021, we introduced new non-financial targets, that will guide our actions to further strengthen our sustainability performance and long-term competitiveness. Work toward even safer, smarter, and more sustainable driving continues.”
Key figures
| EUR million | 10–12 /21 |
10–12 /20 |
Change % |
CC* Change % |
2021 | 2020 | Change % |
CC* Change % |
| Net sales | 512.6 | 413.4 | 24.0% | 18.4% | 1,714.1 | 1,313.8 | 30.5% | 29.7% |
| Operating profit | 53.0 | 71.4 | 268.2 | 120.0 | ||||
| Operating profit % | 10.3% | 17.3% | 15.6% | 9.1% | ||||
| Profit before tax | 49.9 | 70.9 | 258.2 | 106.0 | ||||
| Profit for the period | 37.1 | 55.9 | 206.2 | 86.0 | ||||
| EPS, EUR | 0.27 | 0.40 | 1.49 | 0.62 | ||||
| Segments operating profit | 88.0 | 80.1 | 324.8 | 190.2 | ||||
| Segments operating profit % | 17.2% | 19.4% | 19.0% | 14.5% | ||||
| Segments EPS, EUR | 0.49 | 0.44 | 1.84 | 1.04 | ||||
| Segments ROCE, % | 15.8% | 9.3% | ||||||
| Equity ratio, % | 68.4% | 65.3% | ||||||
| Cash flow from operating activities | 492.6 | 429.0 | 396.5 | 422.4 | ||||
| Gearing, % | -6.1% | -1.1% | ||||||
| Interest-bearing net debt |
-98.7 | -17.2 | ||||||
| Capital expenditure | 60.1 | 31.6 | 119.6 | 149.9 |
* Comparable currencies
The definitions of alternative performance measures (non-IFRS figures) are presented in the report by the Board of Directors in Nokian Tyres Financial Review 2020.
BUSINESS UNIT REVIEWS
Passenger Car Tyres
| EUR million | 10–12 /21 |
10–12 /20 |
Change % |
CC* Change % |
2021 | 2020 | Change % |
CC* Change % |
| Net sales | 342.8 | 262.0 | 30.8% | 24.2% | 1,199.2 | 871.3 | 37.6% | 37.8% |
| Segment operating profit | 77.7 | 66.5 | 298.7 | 177.8 | ||||
| Segment operating profit % | 22.1% | 25.4% | 24.9% | 20.4% |
* Comparable currencies
Heavy Tyres
| EUR million | 10–12 /21 |
10–12 /20 |
Change % |
CC* Change % |
2021 | 2020 | Change % |
CC* Change % |
| Net sales | 65.3 | 53.2 | 22.8% | 19.2% | 254.0 | 194.6 | 30.5% | 28.9% |
| Segment operating profit | 4.1 | 5.0 | 40.3 | 23.7 | ||||
| Segment operating profit % | 6.2% | 9.5% | 15.9% | 12.2% |
* Comparable currencies
Vianor, own operations
| EUR million | 10–12 /21 |
10–12 /20 |
Change % |
CC* Change % |
2021 | 2020 | Change % |
CC* Change % |
| Net sales | 123.1 | 115.4 | 6.7% | 2.8% | 342.9 | 318.1 | 7.8% | 4.2% |
| Segment operating profit | 8.4 | 10.0 | 4.1 | 4.0 | ||||
| Segment operating profit % | 6.8% | 8.7% | 1.2% | 1.3% | ||||
| Number of own service centers at period end | 175 | 174 |
* Comparable currencies
CONFERENCE CALL
A conference call for investors, analysts and media will be held on February 8, 2022 at 3:00 p.m. EET. In the call, President and CEO Jukka Moisio and CFO Teemu Kangas-Kärki will present the financial results.
To participate, please dial in 5−10 minutes before the beginning of the event:
Finland: +358 981 710 310
Sweden: +46 856 642 651
UK: +44 333 300 08 04
US: +1 631 913 1422
PIN: 90066239#
The call can also be listened live via https://nokiantyres.videosync.fi/2021-q4-results/register
A recording of the conference call and a transcript will be available on the company’s website later.
FINANCIAL REPORTING
Nokian Tyres Financial Review for 2021 will be available in English and Finnish at www.nokiantyres.com the week commencing February 28, 2022.
Interim Report January–March 2022: April 27, 2022
THE ANNUAL GENERAL MEETING 2022
The Annual General Meeting of Nokian Tyres plc is scheduled for April 28, 2022.
Releases and company information are available at www.nokiantyres.com/company/investors/.
Nokian Tyres plc
Päivi Antola
SVP, Corporate Communications and Investor Relations
Further information:
Jukka Moisio, President and CEO, tel: +358 10 401 7742
Teemu Kangas-Kärki, CFO, tel: +358 10 401 7750
Päivi Antola, SVP, Corporate Communications and Investor Relations, tel: +358 10 401 7327
Distribution: Nasdaq Helsinki, media and www.nokiantyres.com
Nokian Tyres develops and manufactures premium tires for people who value safety, sustainability and predictability. Our purpose is to empower the world to drive smarter. Inspired by our Scandinavian heritage, we craft innovative products for passenger cars, trucks and heavy machinery that give you peace of mind in all driving conditions. Our Vianor chain provides tire and car services. In 2021, the company’s net sales were EUR 1.7 billion and it employed some 4,900 people. Nokian Tyres is listed on Nasdaq Helsinki. Further information: www.nokiantyres.com