Tikkurila’s Business Review January-March 2019 Profitability continued to improve
Tikkurila's euro-denominated revenue in the first quarter amounted to EUR 129.1 million (1-3/2018: 130.1), a decrease of 0.7 percent from the previous year's level. In local currencies, revenue increased by 2.4 percent. Adjusted operating profit improved to EUR 8.2 (3.6) million and amounted to 6.3 (2.8) percent of revenue.
Tikkurila Oyj Business Review Q1 April 25, 2019 at 9.00 a.m. (CET+1)
"Revenue developed well in local currencies and increased especially in Poland and Russia. The euro-denominated revenue was at a slightly lower level than in the previous year in Sweden and Finland, where we postponed some pre-sales for the season to the second quarter as planned. Tikkurila’s sales volumes increased slightly (1%) in the first quarter.
Profitability improved from the comparison period: adjusted operating profit increased to EUR 8.2 (3.6) million. The fixed cost efficiency program was positively reflected in the profitability. We also continued sales price increases in the first quarter in order to compensate for the significant raw material inflation during the last year”, says Elisa Markula, CEO.
The euro-denominated revenue of SBU East increased by 7.9 percent. Profitability improved thanks to the revenue increase and cost savings. Excluding exchange rate fluctuations, revenue increased by 13 percent compared to the corresponding period a year ago.
In SBU West, revenue increased especially in Poland. In Sweden and Finland, revenue declined due to the postponement of pre-season sales to later in the spring. Excluding the impact of divestments and currency effects, revenue remained at the level of the comparison period. Profitability, however, improved.
| Key figures | |||
| (EUR million) | 1-3/2019 | 1-3/2018 | Change% |
| Group data | |||
| Revenue | 129.1 | 130.1 | -0.7% |
| Operating profit | 7.9 | 0.0 | |
| Adjusted operating profit | 8.2 | 3.6 | 126.5% |
| Adjusted operating profit margin, % | 6.3% | 2.8% | |
| Result for the period | 7.4 | -2.1 | |
| EPS, EUR | 0.17 | -0.05 | |
| Net interest-bearing liabilities (at period-end) | 131.1 | 133.8 | -2.0% |
| Total equity (at period-end) | 160.5 | 173.5 | -7.5% |
| Total assets (at period-end) | 470.3 | 471.7 | -0.3% |
| Segment data | |||
| SBU West revenue | 97.2 | 100.5 | -3.3% |
| SBU West operating profit | 10.5 | 3.4 | 213.2% |
| SBU West adjusted operating profit | 10.6 | 7.3 | 45.7% |
| SBU East revenue | 32.0 | 29.6 | 7.9% |
| SBU East operating result | -0.7 | -2.4 | 71.9% |
| SBU East adjusted operating result | -0.7 | -2.7 | 74.9% |
| Revenue by country | |||
| Sweden | 31.2 | 35.7 | -12.4% |
| Russia | 21.8 | 21.0 | 4.0% |
| Finland | 26.6 | 26.9 | -1.3% |
| Poland | 23.6 | 21.2 | 11.2% |
IFRS 16 standard has been applied as of January 1, 2019. Historical figures have not been adjusted to IFRS 16 standard.
Cash flow after capital expenditure improved due to increased profitability and lower net working capital level. Net working capital decreased particularly due to lower inventory levels and increased trade payables. Gearing increased slightly compared to the comparison period, mainly because of the adoption of the IFRS16 standard.
Market share development in 2018
Tikkurila's market share in decorative paints remained strong in all market areas and there were no significant changes. The management estimates based on recently received data from last year that the market share has remained the same in Russia and Finland and increased in Poland and Sweden.
Guidance for 2019 unchanged
Tikkurila’s revenue is expected to remain at the same level as in 2018 and the adjusted operating profit will improve.
Tikkurila Oyj
Elisa Markula
CEO
For further information, please contact:
Elisa Markula, CEO
Mobile +358 50 596 0978,
elisa.markula@tikkurila.com
Markus Melkko, CFO
Mobile. +358 40 531 1135,
markus.melkko@tikkurila.com
Tikkurila Investor Relations and Communications
ir.tikkurila@tikkurila.com
Sustainable Nordicness
Tikkurila is a leading Nordic paint company with expertise that spans decades. We develop premium products and services that provide our customers with quality that will stand the test of time and weather. We operate in around ten countries and our 2,700 dedicated professionals share the joy of building a vivid future through surfaces that make a difference. In 2018, our revenue totaled EUR 562 million. The company is listed on Nasdaq Helsinki. Nordic quality from start to finish since 1862.
www.tikkurilagroup.com