Tikkurila Oyj
Stock Exchange Release
October 28, 2016 at 9:00 a.m. (CET+1)
Tikkurila`s Business Review for January-September 2016
Tikkurila`s revenue for the third quarter decreased by 5.9 percent to EUR 158.0 million (7-9/2015: EUR 168.0 million). Adjusted operating profit totaled EUR 23.7 (26.0) million, i.e. 15.0 (15.5) percent of revenue.
"The third quarter was disappointing after the strong second quarter. Sales volumes decreased in Russia and Finland during the third quarter. In Russia, the markets were weighed down by low purchasing power among consumers, while the wet summer reduced demand for paint in Finland. In addition, unfavorable changes in the exchange rates and divestments had a negative impact on revenue. Profitability was weakened throughout the Group by the decline in revenue and by higher sales and marketing investments in SBU West. In SBU East, profitability improved compared to the comparison period due to the more favorable development of the ruble.
Our goal is to increase our presence in the new building market and industrial coatings business. We will adjust costs to reflect the market conditions. However, we will continue our strong efforts in sales and marketing activities, and also boost product development," says Erkki Järvinen, President and CEO.
Revenue for January-September decreased by 2.7 percent to EUR 467.8 million (1-9/2015: EUR 480.7 million). Adjusted operating profit totaled EUR 64.6 (70.0) million, i.e. 13.8 (14.6) percent of revenue.
| Key figures | ||||||
| (EUR million) | 7-9/2016 | 7-9/2015 | Change % | 1-9/2016 | 1-9/2015 | Change % |
| Group data | ||||||
| Revenue | 158.0 | 168.0 | -5.9% | 467.8 | 480.7 | -2.7% |
| Adjusted operating profit | 23.7 | 26.0 | -9.1% | 64.6 | 70.0 | -7.7% |
| Adjusted operating profit margin, % | 15.0% | 15.5% | 13.8% | 14.6% | ||
| EPS, EUR | 0.43 | 0.37 | 16.3% | 1.19 | 1.19 | 0.3% |
| Net Interest-bearing liabilities |
|
|
| 64.1 | 46.8 | 37.0% |
| Total equity (at period-end) | 211.5 | 208.3 | 1.5% | 211.5 | 208.3 | 1.5% |
| Total assets (at period-end) | 451.0 | 452.5 | -0.3% | 451.0 | 452.5 | -0.3% |
| Segment data | ||||||
| SBU West revenue | 104.9 | 108.7 | -3.5% | 328.0 | 327.2 | 0.2% |
| SBU West adjusted operating profit | 18.5 | 21.8 | -15.2% | 55.0 | 59.0 | -6.8% |
| SBU East revenue | 53.2 | 59.3 | -10.3% | 139.8 | 153.5 | -8.9% |
| SBU East adjusted operating profit | 6.1 | 5.0 | 21.3% | 13.1 | 14.9 | -12.7% |
| Revenue by country | ||||||
| Sweden | 39.4 | 41.5 | -5.0% | 124.2 | 123.5 | 0.6% |
| Russia | 37.5 | 40.6 | -7.6% | 94.6 | 105.5 | -10.4% |
| Finland | 23.2 | 25.3 | -8.4% | 85.3 | 86.0 | -0.7% |
| Poland | 20.8 | 20.1 | 3.7% | 57.1 | 56.0 | 1.9% |
Financial development in July-September 2016
Tikkurila Group`s revenue decreased in the third quarter of 2016 due to divestments, weak foreign exchange rates and lower sales volumes. Lower sales volumes decreased revenue by 2 percent. Sales price increases that were conducted in Russia at the beginning of the year had a positive effect on revenue.