Tokmanni’s business review for 1 January–31 March 2019: Revenue grew by 8.3%, comparable operating result at the previous year's level

Tokmanni Group Corporation       Business review        Unaudited        25 April 2019 at 8.30 a.m.

Tokmanni has adopted IFRS 16 Leases as of 1 January 2019. This review provides information about the effects of the adoption of the standard on the company’s income statement and balance sheet for 2018, as well as presenting adjusted quarterly comparison information for 2018. The adjusted comparison information for 2018 is provided as an appendix to this bulletin. The numbers in brackets refer to the adjusted figures for 2018.  


  •  Revenue grew by 8.3% (10.9%) to EUR 188.1 million (173.7) 
  •  Like-for-like revenue for stores grew by 4.1% (6.1%) 
  •  Gross profit totalled EUR 58.8 million (54.7), with the gross margin being 31.3% (31.5%) 
  •  Comparable gross profit totalled EUR 58.6 million (54.6), with the comparable gross margin being 31.2% of revenue (31.4%)
  •  Quick conversion of the acquired stores into Tokmanni affected the gross profit by around -0.3% points
  •  EBITDA amounted to EUR 12.4 million (12.5), 6.6% of revenue (7.2%) 
  •  Comparable EBITDA amounted to EUR 12.8 million (12.1), representing 6.8% of revenue (7.0%) 
  •  The operating result (EBIT) was EUR -2.5 million (-1.6), -1.3% of revenue (-0.9%) 
  •  Comparable EBIT amounted to EUR -2.2 million (-1.9), representing -1.2% of revenue (-1.1%) 
  •  Cash flow from operating activities amounted to EUR -28.3 million (-13.9) 
  •  Earnings per share were EUR -0.07 (-0.06). 


Tokmanni expects good revenue growth for 2019, based on the revenue from the new stores acquired and opened in 2018 and new stores to be opened in 2019, as well as on slight growth in like-for-like revenue. Group profitability (comparable EBIT margin) is expected to improve on the previous year. 


“We are very happy with our revenue growth. Our customer numbers developed favourably, increasing by 7.2%. The average basket size also grew somewhat. This year, Tokmanni’s Nettopäivät campaign took place in the first quarter, which increased sales. During the first quarter, we focused on converting Ale-Makasiini stores into Tokmanni stores, and all of our stores will operate under the Tokmanni brand as of tomorrow. Clearance sales and changes to the product selections of Ale-Makasiini stores, as well as the Nettopäivät campaign, had an impact on our gross profit during the first quarter.  

Tokmanni’s goal for 2019 is profitability improvement. We will target our profitability improvement measures at reducing the relative share of fixed costs and increasing our gross margin in particular. During the first quarter, we were able to start reducing the relative share of property and personnel expenses according to plan. At the moment, we are paying special attention to improving our gross margin. 

For Tokmanni, the spring season is the second most important sales period of the year. Tokmanni’s employees and stores are ready to serve customers, as well as offering them a diverse selection of products at low prices.” 

Key figures
Change% Reported 
Revenue, MEUR 188.1 173.7 8.3% 173.7 870.4 870.4
Like-for-like revenue development, % 4.1 6.1 6.1 5.6 5.6
Customer visit development % 7.2 6.9 6.9 6.9 6.9
Gross profit, MEUR 58.8 54.7 7.4% 54.7 295.3 295.3
Gross margin, % 31.3 31.5 31.5 33.9 33.9
Comparable gross profit, MEUR 58.6 54.6 7.4% 54.6 295.0 295.0
Comparable gross margin, % 31.2 31.4 31.4 33.9 33.9
Operating expenses -47.3 -43.2 9.7% -54.5 -188.1 -234.3
Comparable operating expenses -46.8 -43.4 8.0% -54.7 -189.5 -235.7
EBITDA, MEUR 12.4 12.5 -0.3% 1.2 111.2 64.9
EBITDA, % 6.6 7.2 0.7 12.8 7.5
Comparable EBITDA, MEUR 12.8 12.1 5.7% 0.8 109.5 63.3
Comparable EBITDA, % 6.8 7.0 0.5 12.6 7.3
Operating profit (EBIT), MEUR -2.5 -1.6 -62.0% -2.4 53.6 50.3
Operating profit margin EBIT, % -1.3 -0.9 -1.4 6.2 5.8
Comparable EBIT, MEUR -2.2 -1.9 -12.7% -2.8 51.9 48.6
Comparable EBIT, % -1.2 -1.1 -1.6 6.0 5.6
Net financial items, MEUR -2.6 -2.7 -4.4% -1.5 -10.6 -5.6
Net capital expenditure, MEUR* 2.7 1.4 89.6% 1.4 19.8 19.8
Net debt / comparable EBITDA ** / **** 3.8 3.2 3.5 2.1
Net cash from operating activities, MEUR -28.3 -13.9 -23.9 85.8 44.9
Return on capital employed, % -0.4 -0.4 -0.8 11.6 14.6
Return on capital employed %, rolling 12 months**** 9.3 13.4 9.5 15.0
Return on equity, % -3.2 -2.7 -2.4 20.8 21.2
Return on equity %, rolling 12 months**** 22.8 20.9 23.6 23.4
Equity ratio, % 18.7 19.1 30.3 23.2 36.0
Number of shares, weighted average during the financial period (thousands) 58 869 58 869 58 869 58 869 58 869
Earnings per share (EUR/share) -0.07 -0.06 -0.05 0.58 0.61
Personnel at the end of the period 3 473 3 180 3 180 3 558 3 558
Personnel on average in the period 3 427 3 159 3 159 3 415 3 415

* Net capital expenditure, excluding non-current receivables from others 
** Rolling 12 months comparable EBITDA
*** The adjusted figure includes comparable calculations in accordance with IFRS 16
**** Comparison figure not available, as no adjustment was made for IFRS 16 for 2017 

Adjustments affecting comparability 

Tokmanni reports EBITDA as one of its key performance indicators and makes adjustments to improve comparability and provide a better view of Tokmanni’s operational performance. EBITDA is a non-IFRS indicator that represents operating profit before depreciation and amortisation. Comparable EBITDA represents EBITDA excluding items that Tokmanni’s management considers to be exceptional and non-recurring, including changes in the fair value of electricity and currency derivatives, which are adjusted by Tokmanni, as they are unrealised gains or losses related to Tokmanni’s open cash flow hedge positions and are therefore not related to Tokmanni’s operational performance during the review periods.  

On 8 February 2019, Tokmanni’s Board of Directors updated the Group’s long-term financial targets due to the implementation of the IFRS 16 standard as of 1 January 2019. In conjunction with this, comparable EBITDA margin was replaced with comparable EBIT margin. More information about Tokmanni’s updated long-term financial targets and the related changes is available at 

Tokmanni’s management uses comparable EBIT margin as a key performance indicator to assess Tokmanni’s underlying operational performance. 

Adjustments affecting comparability
MEUR 1-3/2019 Adjusted***
Gross profit 58.8 54.7 295.3
Changes in fair value of currency derivatives -0.2 -0.2 -0.3
Comparable Gross Profit 58.6 54.6 295.0
Operating expenses -47.3 -43.2 -188.1
Changes in fair value of electricity derivatives 0.5 -0.2 -1.4
Comparable operating expenses -46.8 -43.4 -189.5
EBITDA 12.4 12.5 111.2
Operating profit (EBIT) -2.5 -1.6 53.6
Changes in fair value of currency derivatives -0.2 -0.2 -0.3
Changes in fair value of electricity derivatives 0.5 -0.2 -1.4
Comparable EBITDA 12.8 12.1 109.5
Comparable operating profit (adj. EBIT) -2.2 -1.9 51.9

*** The adjusted figure includes comparable calculations in accordance with IFRS 16 


The non-grocery market increased by 4.0% during the first quarter according to the Finnish Grocery Trade Association FGTA (, with the trend being good in March in particular. The revenue of department store and hypermarket chains increased by 1.0%. Tokmanni clearly outperformed the rest of the market in terms of growth. 

The member companies of the FGTA operate the department store and hypermarket chains of K-Citymarket, Prisma, Sokos, Stockmann, Tokmanni and Minimani. However, it is important to note that the statistics compiled by the FGTA only cover part of Tokmanni’s addressable market and exclude online sales, for example. 


Store network development  

Expanding the store network is one of the key targets for growing Tokmanni’s revenue and profitability. Tokmanni has an efficient process of rolling out and ramping up new stores. At the end of the first quarter, Tokmanni had 188 stores in Finland (31 March 2018: 175 stores). Tokmanni has 13 fresh grocery stores around Finland. 

The four stores acquired by Tokmanni in northern Finland were transferred to Tokmanni on 1 January 2019. In January–March, the total retail space in Tokmanni’s stores increased by around 5,300 square metres.  

By 25 April 2019, Tokmanni had agreed on the opening of seven new stores and two relocated stores during 2019. Tokmanni’s goal is to increase its retail space by some 12,000 square metres in net terms annually, which means around five new or relocated stores each year.  

Tokmanni considers a store to be new or relocated over the duration of its opening year and the following calendar year. On average, a new store becomes profitable after around 12 months and reaches its full capacity within around 24 months. 

New and relocated stores include new stores opened; store relocations where the store size changes by 30 per cent or more and the assortment increases or is reduced substantially; and store expansions where the store size changes by 30 per cent or more. Tokmanni deducts stores closed during a financial period from the new and relocated stores on a net basis. 



Tokmanni’s business is subject to seasonality, which has a significant effect on its revenue, profitability and cash flows. Generally, revenue, profitability and cash flows are lowest in the first quarter and highest in the fourth quarter due to Christmas sales. 

First-quarter revenue 

In the first quarter, Tokmanni’s revenue grew by 8.3% to EUR 188.1 million (173.7). The strong revenue growth was mainly due to investments in expanding product selections and further developing the store concept, as well as low prices. Sales development was at a good level in the clothing and tool products categories in particular. Like-for-like revenue for stores grew by 4.1% (6.1%). 

The number of customers grew in the first quarter by 7.2% year-on-year. At the same time, the average basket size grew by 1.1%.  

First-quarter profitability 

First-quarter gross profit totalled EUR 58.8 million (54.7), corresponding to a gross margin of 31.3% (31.5%). Comparable gross profit was EUR 58.6 million (54.6), corresponding to a gross margin of 31.2% (31.4%). Profitability was mainly burdened by the conversion of Ale-Makasiini stores into Tokmanni stores and the related clearance sales and changes to product selections. These had an effect of around EUR -0.5 million on the first-quarter gross profit, corresponding to around 0.3 percentage points. In addition, the Nettopäivät campaign took place in the first quarter this year, which also burdened the gross margin slightly.  

In the first quarter, operating expenses increased to EUR 47.3 million (43.2), or 25.2% of revenue (24.9%). Comparable operating expenses were EUR 46.8 million (43.4), or 24.9% of revenue (25.0%). In other words, the relative share of comparable operating expenses developed in the right direction. The increase in euro-denominated operating expenses was mainly due to the expansion of the store network. The year-on-year increase in sales volumes in the first quarter was also reflected in operating expenses. In addition, due to the timing of the Nettopäivät campaign, investment in marketing increased year-on-year. Personnel expenses totalled EUR 26.8 million (25.0), or 14.2% of revenue (14.4%). 

First-quarter EBITDA amounted to EUR 12.4 million (12.5), and the EBITDA margin was 6.6% (7.2%). Comparable EBITDA totalled EUR 12.8 million (12.1), and comparable EBITDA was 6.8% (7.0%).  

Operating profit (EBIT) in the first quarter totalled EUR -2.5 million (-1.6), corresponding to -1.3% of revenue (-0.9%). Comparable EBIT totalled EUR -2.2 million (-1.9), and comparable EBIT margin was -1.2% (-1.1%). Tokmanni’s long-term target is to gradually increase its comparable EBITDA margin to around 9% by improving the gross margin and reducing the relative share of operating expenses of revenue from the current level.  

Net financial items amounted to EUR -2.6 million (-2.7) in the first quarter. The result before taxes was EUR
-5.2 million (-4.3). Taxes amounted to EUR 1.0 million (0.9). The net result for the period was EUR -4.1 million (-3.4). Earnings per share were EUR -0.07 (-0.06).

Balance sheet, financing and cash flow 

At the end of March, Tokmanni’s inventories amounted to EUR 214.0 million (187.9). The increase in inventories was mainly due to the expansion of the store network and partly due to the larger number of stock-keeping units, as well as Easter being celebrated in the second quarter this year. As a result of the increase in inventories, cash flow from operating activities amounted to EUR -28.3 million (-13.9) in the first quarter of 2019. Cash and cash equivalents totalled EUR 5.3 million (13.8) at the end of the review period.  

At the end of March 2019, Tokmanni’s interest-bearing debt totalled EUR 428.0 million (430.2). Following the adoption of the IFRS 16 standard, leases were transferred to liabilities and assets on the balance sheet, which increased the amount of liabilities significantly compared with what was reported before. 

At end of March, net debt / comparable EBITDA (rolling 12 months) was 3.8 (comparison figure not available, as no adjustment was made for IFRS 16 for 2017). Tokmanni intends to maintain an efficient long-term capital structure, and its long-term goal is to keep the ratio of net debt to comparable EBITDA below 3.2. 

Capital expenditure 

Net capital expenditure in the first quarter of 2019 amounted to EUR 2.7 million (1.4). The increase in capital expenditure was mainly due to the expansion of the store network, renovations of stores and the development of digital services. Capital expenditure in 2019 is expected to be around EUR 14–15 million.  


Tokmanni is a significant employer in Finland. At the end of March 2019, the Group had 3,473 (3,180) employees. Personnel expenses for the first quarter were EUR 26.8 million (25.0).  


Tokmanni’s risks and uncertainties are discussed in detail in its financial statements bulletin and Board of Directors’ report for 2018. No major changes to these risks have occurred during the quarter. 


Tokmanni expects good revenue growth for 2019, based on the revenue from the new stores acquired and opened in 2018 and new stores to be opened in 2019, as well as on slight growth in like-for-like revenue. Group profitability (comparable EBIT margin) is expected to improve on the previous year.

Mäntsälä, 25 April 2019

Tokmanni Group Corporation

Board of Directors

For further information, please contact

Mika Rautiainen, CEO
tel. +358 0207286061, mika.rautiainen(at)

Markku Pirskanen, CFO
tel: +358 20 728 7390, markku.pirskanen(at)

Maarit Mikkonen, Head of IR and Communications
tel. +358 40 562 2282, maarit.mikkonen(at)

IR calendar 2019

Tokmanni publishes shorter business reviews for the first and third quarters, and a comprehensive interim report covering the period January-June 2019. Release dates are:

  •  January-June 2019 Half Year Financial review: 8 August 2019
  •  January-September 2019 Business review: 30 October 2019

Result presentation

Tokmanni’s CEO Mika Rautiainen and CFO Markku Pirskanen will present the review to analysts, investors and media representatives on the publication day in Finnish at 10.00 am and in English at 11.30 am.

The English live audiocast can be accessed via Tokmanni’s website at or through the link

The participants can also join a telephone conference that will be arranged in conjunction with the live webcasts. The participants are asked to dial in 5-10 minutes prior to starting time using the Participant Phone Numbers below (PIN: 67358879#):

Finland: +358 981 710 310
Sweden: +46 856 642 651
UK: +44 333 300 08 04
US: +1 631 913 14 22

An on demand version of the audiocast will be found on the website later during the day.

Tokmanni in brief 

Tokmanni is the largest general discount retailer in Finland measured by number of stores and revenue. In 2018, Tokmanni’s revenue was EUR 870.4 million and it has approximately 3,600 employees. Tokmanni is the only nationwide general discount retailer in Finland, with almost 200 stores across Finland. 


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