| Segments (EURm) | Q3/12 | Q3/11 | yoy | 9m/12 | 9m/11 | yoy |
| Supermarkets | 81.8 | 81.6 | 0.2% | 243.1 | 234.9 | 3.5% |
| Department stores | 20.2 | 18.9 | 6.8% | 60.3 | 55.2 | 9.1% |
| Car trade | 9.0 | 5.3 | 70.5% | 24.5 | 14.2 | 72.1% |
| Footwear trade | 3.8 | 3.8 | -0.1% | 10.4 | 10.0 | 3.3% |
| Real Estate | 0.7 | 0.7 | 1.6% | 2.1 | 2.1 | 4.0% |
| Total sales | 115.5 | 110.3 | 4.7% | 340.4 | 316.5 | 7.6% |
| Supermarkets | 3.8 | 5.1 | -25.0% | 5.6 | 6.6 | -15.8% |
| Department stores | 0.5 | 0.5 | 7.7% | 1.0 | 0.5 | 119.6% |
| Car trade | 0.6 | 0.4 | 48.9% | 1.5 | 1.0 | 51.2% |
| Footwear trade | 0.0 | 0.0 | - | -0.3 | -0.4 | 22.2% |
| Real Estate | 2.2 | 1.7 | 27.1% | 4.8 | 5.1 | -5.4% |
| Total net profit | 7.1 | 7.7 | -7.3% | 12.7 | 12.8 | -1.3% |
The consolidated unaudited sales revenue of the Tallinna Kaubamaja Group in the first nine months of 2012 was 340.4 million euros, having increased by 7.6% compared to the nine months of 2011. In the third quarter, the Group’s sales revenue reached 115.5 million euros, exceeding the sales revenue of a year earlier by 4.7%. The Group’s consolidated unaudited net profit of the first 9 months of 2012 was 12.7 million euros, which is 1.3% less than the net profit of the same period of the previous year (12.8 million euros). The Group's net profit earned in the 3rd quarter was 7.1 million euros, having decreased by 7.3% compared to the corresponding result of 2011, which was 7.7 million euros. The pre-tax profit of the first 9 months was 16.4 million euros, having grown by 3.5% in a year. The net profit of the first 9 months was influenced by the write-off of commercial software that had lost its usefulness – in the sum of 0.9 million euros, which was recorded in the depreciation of fixed assets.
For this year, the Tallinna Kaubamaja Group has planned and partially already executed the modification and expansion of its sales spaces. In March, the Department store opened an extensively renovated women's department and children's department in Tallinn, whilst Saku Selver was opened and a renewed partner loyalty program Partner card was launched in May. An ABC footwear store was reopened in Pärnu in July, a new I.L.U. beauty store was opened in Tartu in August, and in September, Selver opened a new gourmet store in downtown Tallinn. There are plans to open several Selver and footwear stores at the end of the year. The division of the department stores, the central kitchen and the security functions into new subsidiaries to make the management structure of the Group more transparent and competitive was the most significant internal reorganisation for the Group undertaken in the 3rd quarter. The divisions were approved at the extraordinary general meeting of shareholders held on August 21, 2012, and were completed on 1 October 2012. The development activities resulted in the increase of investments and one-time operational expenditure, which in turn influenced the results of the Group in the 3rd quarter. The renewed loyalty programme, warmly welcomed by our customers, gives them additional bonus points for their Partner card purchases in the amount of 1% of the purchase sum. During the period when the customers collect such bonus points, the turnover and margin of the Group decrease to the same extent. The expected positive impact on the economic results of the Group becomes apparent once the bonus points are put to use. The growing popularity of the Partner card allows the realization of the program’s positive impact in the form of increased sales revenue, and the best time for that is probably the end of the year.
Supermarkets
The consolidated sales revenue of the business segment of supermarkets and the segment’s sales revenue earned in Estonia in the nine months of 2012 were 243.1 million euros, having grown by 3.5% compared to the year before. The consolidated sales revenue and the sales revenue earned in Estonia in the 3rd quarter were 81.8 million euros, which is 0.2% higher than the result of the same period of the previous year. The consolidated pre-tax profit of the supermarket segment earned in the first 9 months of 2012 was 8.4 million euros, which is 13.2% smaller than the profit of the previous comparable period. Net profit was earned in the sum of 5.6 million euros, which is 15.8% smaller than the net profit of the previous comparable period. The consolidated pre-tax profit and net profit of the 3rd quarter was 3.8 million euros, having decreased by 25.0% compared to the period of a year before in both respects. The pre-tax profit earned in Estonia during the first 9 months was 10.1 million euros, 4.4 million euros of which was earned in the 3rd quarter. The profit deviations compared to the period of a year earlier were -11.1% and -22.3% respectively. The Estonian net profit of the supermarket segment earned in the first 9 months was 7.3 million euros, having decreased by 12.4% compared to the corresponding reference period. The net profit of 4.4 million euros earned in the 3rd quarter made up 77.7% of the profit earned a year earlier. The pre-tax loss and net loss earned in Latvia in the first 9 months was 1.8 million euros, of which the share of the 3rd quarter was 0.6 million euros. The loss remained at the same level as the previous year, changing by +0.3% and +2.1% respectively. Business activities in Latvia have been frozen.
The profit earned in Selvers in Estonia was positively influenced by cost-effective activities. In addition, the income tax paid on dividends was 7.6% lower than the year before. Compared to last year, the shaping of the profit of the first 9 months of this year was influenced by greater depreciation costs and operational expenditure caused by renovation works undertaken in four stores during the previous year, the introduction of the SelveEkspress purchasing system (which is new in Estonia) in four stores during the previous and current year, the creation of the Selveri Pagarid bakery concept completed in the 1st quarter of this year, and the opening of the Saku Selver and Selver gourmet stores. As a result of the above, 2011 and 2012 have seen a larger volume of investments and operational expenditure than the previous years. In June of this year the decision was made to replace commercial software – as a result, software investments in the sum of 0.9 million euros were written off.
A Selver store in Narva was closed in July 2011. In May this year, Selver opened one new supermarket-type store in Saku, and in September, a new store for gourmet goods in downtown Tallinn. In the end of this year, Selver will open another 4 stores: supermarkets in Rapla and in the Vahi quarter of Tartu, a home store in Pääsküla, Tallinn and a second store for gourmet goods in Solaris Keskus, Tallinn. Selver plans to continue active expansion in 2013. Lease contracts, according to which, Selver is going to open at least 3 additional supermarkets, have been entered into. As of the end of September 2012, the Selver chain includes 36 stores with a sales space of 71.2 thousand square metres.
Department stores
The sales revenue of the business segment of department stores in the first 9 months of 2012 was 60.3 million euros, having grown by 9.1% compared to the same period of the previous year. Of that sum, 20.2 million euros of sales revenue was earned in the third quarter; the sales revenue was 6.8% higher than the revenue of the 3rd quarter of 2011. The profit of department stores in the first nine months of 2012 was 1.0 million euros, exceeding the result of the year before by 0.5 million euros. The profit of the 3rd quarter was 0.5 million euros, which exceeded the profit of 2011 by 7.7%. In the 3rd quarter, the results of Department store segment were affected by the temporary adjustment of traffic management on the street in front of the Tallinn department store in summer 2012. The sales revenue in the 3rd quarter was influenced by renovation works in the Tartu department store – in August, a new Women’s footwear department was opened instead of the former Sports department, and the Beauty and Women’s department was expanded in September. The sales revenue of the first 9 months was affected by the extensive renovation works in the Women's and Children's World of Tallinna Kaubamaja, which lasted from mid-January to March.
The sales revenue of OÜ TKM Beauty Eesti, which operates the I.L.U. beauty stores, was 2.7 million euros in the first nine months of 2012, having grown by 33.3% compared to the same period of the year before. Of that sum, the sales revenue of the 3rd quarter was 1.0 million euros, which was 23.9% higher than the sum earned in the respective period of 2011. The net loss of the I.L.U. chain in the first nine months was 0.4 million euros, which is 0.05 million euros less than in the same period the year before. The loss of the 3rd quarter was 0.5 million euros, which was 9 thousand euros smaller than the loss suffered in 2011.
Car Trade
The sales revenue of the car trade segment earned in the first nine months of 2012 without inter-segment transactions was 24.5 million euros, thus exceeding the revenue of the same period of the year before by 72.1%. The sales revenue of the third quarter in the sum of 9.0 million euros was greater than the revenue of the year before by 70.5%. The segment earned a profit 1.5 million euros in nine months, of that, 0.6 million was generated in the 3rd quarter. The respective profits of 2011 were 1.0 million euros and 0.4 million euros. The turnover growth is rooted in the successful sales of new KIA models such as the Cee’d, Rio and Optima, and the continuing great demand for the crossover SUV KIA Sportage. The sales of KIA in the Baltics have been remarkable, increasing in a year by more than 120% in Estonia, 90% in Latvia and 53% in Lithuania, thus effortlessly winning the first place among other brands. In the first 9 months of 2012, a total of 1,386 vehicles were sold in the vehicle segment, i.e. 628 vehicles more than the year before during the same period. In the 4th quarter, the sales volume should once again increase thanks to the arrival of the new Sorento. In addition, the vehicle segment of Tallinna Kaubamaja was supplemented by obtaining the sales of the Opel and Cadillac models sold by Viking Motors AS in the beginning of July this year. 34 Opel and Cadillac models were sold in the 3rd quarter. The volume of the sales of spare parts and services provided by Viking Motors AS in the Tallinn and Harju County market is also important. In addition, the purchase of Viking Motors AS gave us an opportunity to offer car body repair work for KIA clients, for whom the services had previously been outsourced. In addition, the sales of used KIA passenger cars increased thanks to the modern sales area for used cars located at Tammsaare tee 51. The sales revenue of Viking Motors in the 3rd quarter of this year was 1.2 million euros.
Footwear trade
The turnover of the footwear trade segment in the first nine months of 2012 was 10.4 million euros, having grown by 3.3% in a year. In the 3rd quarter, the turnover was 3.8 million euros, which is 0.1% less compared to the same period of 2011. The decrease in sales revenue in the 3rd quarter was caused by a drop in the number of stores – compared to the 3rd quarter of 2011, business activities in Latvia had been terminated by the 3rd quarter of this year and the 3 stores operating in Latvia had been closed. The increase in the turnover of comparable stores was 10% per 9 months and 3% in the 3rd quarter. The loss of the first nine months was 0.3 million euros, which has decreased by approximately 0.1 million euros compared to the same period of the previous accounting year. In the 3rd quarter of year 2012 as well as in the 3rd quarter in 2011, the Footwear trade segment loss remained at zero. On July 5, an ABC King store was reopened in the Pärnu Kaubamajakas. The opening of the Viljandi Shu and the second Shu store in Pärnu is planned to take place in November 2012; the opening of a new ABC King store in Tartu Lõunakeskus is planned for December.
Real Estate
The extra-group sales revenue of the real estate business segment earned in the first 9 months of 2012 was 2.1 million euros, having grown by 4.0% compared to the same period of the previous year. The extra-group sales revenue of the real estate business segment earned in the 3rd quarter of 2012 was 0.7 million euros, having increased by 1.7% compared to the same period of the previous year. The increase was mainly due to the rearrangement of the lessees and rented spaces of Tartu Kaubamaja Kinnisvara OÜ during the first half of the year 2012. The pre-tax profit of the segment of real estate of the first nine months was 5.8 million euros and the pre-tax profit of the 3rd quarter was 2.2 million euros. This result exceeded the pre-tax profit of the first nine months of the year before by 0.7 million euros and the pre-tax profit of the 3rd quarter by 0.5 million euros, which is based on an increase in sales revenues. The segment’s net profit of the nine months was 4.8 million euros, which is 0.3 million euros less than the net profit earned year earlier due to the income tax paid on dividends. The net profit of the 3rd quarter was 2.2 million euros, which is 0.5 million euros higher than the net profit of the 3rd quarter of 2011.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
In thousands of euros
| 30.09.2012 | 31.12.2011 | |
| ASSETS | ||
| Current assets | ||
| Cash and bank | 8,091 | 11,948 |
| Trade receivables | 8,387 | 9,976 |
| Other short-term receivables | 254 | 9,372 |
| Prepaid taxes and other prepayments | 874 | 959 |
| Inventories | 48,739 | 41,973 |
| Total current assets | 66,345 | 74,228 |
| Non-current assets | ||
| Receivables and prepayments | 1,025 | 1,041 |
| Investments in associates | 1,620 | 1,550 |
| Investment property | 3,728 | 3,566 |
| Property. plant and equipment | 187,888 | 172,272 |
| Intangible assets | 11,411 | 9,809 |
| Total non-current assets | 205,672 | 188,238 |
| TOTAL ASSETS | 272,017 | 262,466 |
| LIABILITIES AND EQUITY | ||
| Current liabilities | ||
| Borrowings | 5,977 | 11,261 |
| Trade payables | 46,760 | 46,419 |
| Tax liabilities | 3,877 | 5,038 |
| Other current liabilities | 3,592 | 4,489 |
| Provisions | 106 | 135 |
| Total current liabilities | 60,312 | 67,342 |
| Non-current liabilities | ||
| Borrowings | 73,066 | 55,591 |
| Provisions and prepayments | 609 | 73 |
| Total non-current liabilities | 73,675 | 55,664 |
| TOTAL LIABILITIES | 133,987 | 123,006 |
| Equity | ||
| Share capital | 24,438 | 24,438 |
| Statutory reserve capital | 2,603 | 2,603 |
| Revaluation reserve | 51,358 | 52,197 |
| Retained earnings | 59,581 | 60,333 |
| Currency translation differences | 50 | -111 |
| TOTAL EQUITY | 138,030 | 139,460 |
|
TOTAL LIABILITIES AND EQUITY |
272,017 | 262,466 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
In thousands of euros
| III quarter 2012 | III quarter 2011 | 9 months 2012 | 9 months 2011 | |||
| Revenue | 115,497 | 110,287 | 340,364 | 316,467 | ||
| Other operating income | 383 | 162 | 633 | 282 | ||
| Materials, consumables used and services | -86,179 | -81,090 | -254,058 | -234,526 | ||
| Other operating expenses | -11,126 | -10,823 | -34,259 | -32,809 | ||
| Staff costs | -8,472 | -7,867 | -26,135 | -24,843 | ||
| Depreciation, amortisation and impairment losses | -2,685 | -2,496 | -8,794 | -7,432 | ||
| Other expenses | -65 | -54 | -270 | -220 | ||
| Operating profit | 7,353 | 8,119 | 17,481 | 16,919 | ||
| Finance income | 21 | 50 | 109 | 181 | ||
| Finance costs | -275 | -514 | -1,263 | -1,366 | ||
| Finance income on shares of associates | 21 | 32 | 100 | 133 | ||
| Profit before tax | 7,120 | 7,687 | 16,427 | 15,867 | ||
| Income tax | 3 | 0 | -3,763 | -3,031 | ||
| NET PROFIT FOR THE FINANCIAL YEAR | 7,123 | 7,687 | 12,664 | 12,836 | ||
| Other comprehensive income: | ||||||
| Currency translation differences | 23 | -3 | 161 | 73 | ||
| Other comprehensive income for the financial year | 23 | -3 | 161 | 73 | ||
| TOTAL COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR | 7,146 | 7,684 | 12,825 | 12,909 | ||
Raul Puusepp
Chairman of the Board
Phone +372 731 5000
