| Segments (EURm) | Q1/15 | Q1/14 | yoy |
| Supermarkets | 86.3 | 82.4 | 4.7% |
| Department stores | 21.8 | 20.6 | 5.8% |
| Cars | 12.3 | 12.4 | -0.8% |
| Footwear | 2.2 | 3.4 | -34.3% |
| Real Estate | 0.8 | 0.8 | 0.1% |
| Total sales | 123.5 | 119.7 | 3.2% |
| Supermarkets | -1.2 | -1.0 | 13.1% |
| Department stores | -1.3 | -0.4 | 205.2% |
| Cars | 0.0 | -0.5 | -91.1% |
| Footwear | -0.7 | -0.8 | -7.5% |
| Real Estate | 2.1 | 2.1 | 0.2% |
| Total net profit | -1.2 | -0.6 | 88.8% |
The unaudited consolidated sales revenue of the 1st quarter of 2015 of the Tallinna Kaubamaja Group was 123.5 million euros. Compared to the 1st quarter of 2014, when the sales revenue was 119.7 million euros, the growth was 3.2%. In volume, sales revenue grew in the most important segments of the Group, while the car trade and footwear segments fell short of the sales results of the previous year. The net loss of the accounting period was 1.2 million euros due to income tax calculated from dividends to the amount of 3.9 million euros. The loss of the first quarter of 2014 was 0.6 million euros, including income tax of 1.3 million euros. The pre-tax profit was a profit three times larger than that of the previous year, to the amount of 2.7 million euros.
The growth in sales revenue achieved in the 1st quarter followed the pace of the entire Estonian retail market. As predicted, the turnover of the cars’ segment was in a slight decline, following the shopping boom in November of the previous year. The turnover of the footwear trade’s segment also decreased due to sharp increase in competition and the rearrangement of the segment’s flagship store. For several years in a row, the sales of fashion items have been held back by a warm winter, which allows the customers to avoid purchasing winter clothes and footwear and puts more pressure on margins due to discounts of winter goods. Overall, the Group’s margin has recovered, owing to improvement in commercial management of larger segments, along with a more competent implementation of the trading system. Increase in pre-tax profit has been supported by controlling the labour and administration costs. The latter was boosted by slightly lower energy prices. Additionally, the end of the introduction period of a new commercial software lead to improved trade processes and a more effective use of the workforce.
Selver supermarkets
The consolidated sales revenue of the 1st quarter of 2015 of the supermarkets was 86.3 million euros, having increased by 4.7% compared to the period of the previous year. The consolidated pre-tax profit of the supermarkets’ segment was 1.0 million euros in the 1st quarter of 2015, whereof profit earned in Estonia formed 1.7 million euros, having increased by 1.7 million euros compared to the previous year. The consolidated net loss of the supermarkets segment was 1.2 million euros, having increased by 0.1 million euros compared to the result of the previous year. Net loss earned in Estonia was 0.6 million euros in the 1st quarter of 2015, having increased by 0.1 million euros compared to the previous year. The difference between the net income and the profit before income tax arises from the income tax paid from dividends – in 2014, the income tax of dividends was 0.4 million euros; in 2015, it was 2.2 million euros. Increase in sales of the 1st quarter of 2015 has been supported by successful marketing campaigns. The 2014 comparison basis does not yet include Astri Selver, opened in June 2014, the addition of which has also influenced increase in turnover. A positive aspect is that in an increasingly tightening competition situation, where new stores are being opened continuously, customers have remained loyal to Selver. This is also affirmed by the number of purchases, which has remained on the same level as the previous year. Average purchase of customers has increased. Activities regarding the assortment of goods have met the expectations of customers. In Estonia, the greatest impact on the profit earned has been the achievement of more efficiency regarding the main process, especially the sale of goods. Stock has been managed more capably, and as a result, the need for discounting and writing off goods has decreased. The cost-effective level of the previous year has been maintained regarding operating costs. Labour productivity indicators have improved.
Department stores
The sales revenue of the first three months of 2015 of the department stores’ business segment was 21.8 million euros, having increased by 5.8% compared to the same period in the previous year. The pre-tax loss of the 1st quarter of 2015 of department stores was 0.2 million euros, which was 0.2 million euros lower than the result of the previous year. The outcome of department stores was affected negatively by warm winter months compared to the previous years, inhibiting the sales of outwear. Considering the locations of department stores in town centres, the record-low number of tourists negatively affected the sales revenue of the first quarter. The sales revenue of the 1st quarter of 2015 of OÜ TKM Beauty Eesti, which operates the I.L.U. cosmetics stores, was 1.1 million euros, having increased by 8.9% compared to the same period in 2014. Loss of the 1st quarter was 0.1 million euros, which was 6.4% smaller than the loss of the same period in 2014. The sales revenue of the first quarter was affected positively by successful sales campaigns, a more attractive store location in Ülemiste centre, and an assortment, which was more in line with the customers’ expectations compared to the period from the previous year.
Car Trade
The sales revenue of the 1st quarter of 2015 of the car trade’s segment was 12.3 million euros. The sales revenue fell short of the revenue of the same period of the previous year by 0.8%, while the sales revenue of KIAs still increased by 6.2%. Altogether 565 new vehicles were sold in the first three months of the year. The pre-tax profit of the first quarter of 2015 of the segment was 0.5 million euros, having increased nearly seven times compared to the previous year. The profit of the previous year was weaker than usual due to a large percentage of fleet sales. At the end of February, the new model of KIA Sorento has arrived for sale, which immediately gained popularity among the clients.
Footwear trade
The sales revenue of the 1st quarter of 2015 of footwear trade was 2.2 million euros, having decreased by 34.3% compared to the same period in 2014. Meanwhile, the loss of the 1st quarter in 2015 decreased by 7.5% compared to the loss of the 1s quarter in 2014. On the one hand, decrease in sales revenue was connected to unconventional weather conditions of the winter season, which did not promote the sales of warm winter boots, thus negatively affecting both the sales revenue and margin. On the other hand, the comparison basis was raised by the successful closing sales of SHU and ABC King stores at Viru centre in the first quarter of 2014. To date, the renewed footwear area of Viru centre has not launched in the desired level. The footwear trade segment is renewing its assortment and brand portfolio. In relation to that, it is launching new types of marketing campaigns and paying special attention to improving service quality, with which to face the significantly tightening competition situation that has occurred in the Estonian footwear market as a whole in the previous year.
Real Estate
The sales revenue of the 1st quarter of 2015 of real estate outside the Group was 0.8 million euros, which is 0.2% more than the same period in the previous year. The pre-tax and net profit of the 1st quarter of 2015 of the real estate segment was 2.1 million euros, which is on the same level as the results of the same period of the previous monetary year. The extensive renovation works of Tartu Kaubamaja, which were started in 2015 to modernise the sales environment, have inhibited revenue and growth. The Viimsi shopping and entertainment centre is planned to open in the August of 2015.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
In thousands of euros
| 31.03.2015 | 31.12.2014 | |
| ASSETS | ||
| Current assets | ||
| Cash and cash equivalents | 22,880 | 24,626 |
| Trade and other receivables | 11,186 | 17,938 |
| Inventories | 62,292 | 56,876 |
| Total current assets | 96,358 | 99,440 |
| Non-current assets | ||
| Long-term trade and other receivables | 338 | 338 |
| Investments in associates | 1,825 | 1,778 |
| Investment property | 3,035 | 3,035 |
| Property, plant and equipment | 227,925 | 227,914 |
| Intangible assets | 10,276 | 10,402 |
| Total non-current assets | 243,399 | 243,467 |
| TOTAL ASSETS | 339,757 | 342,907 |
| LIABILITIES AND EQUITY | ||
| Current liabilities | ||
| Borrowings | 15,166 | 20,405 |
| Trade and other payables | 84,645 | 70,317 |
| Total current liabilities | 99,811 | 90,722 |
| Non-current liabilities | ||
| Borrowings | 82,880 | 77,663 |
| Provisions for other liabilities and charges | 692 | 692 |
| Total non-current liabilities | 83,572 | 78,355 |
| TOTAL LIABILITIES | 183,383 | 169,077 |
| Equity | ||
| Share capital | 16,292 | 16,292 |
| Statutory reserve capital | 2,603 | 2,603 |
| Revaluation reserve | 66,795 | 67,159 |
| Currency translation differences | -255 | -255 |
| Retained earnings | 70,939 | 88,031 |
| TOTAL EQUITY | 156,374 | 173,830 |
| TOTAL LIABILITIES AND EQUITY | 339,757 | 342,907 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
In thousands of euros
| 3 months 2015 | 3 months 2014 | ||
| Revenue | 123,458 | 119,651 | |
| Other operating income | 231 | 148 | |
| Cost of sales | -93,035 | -91,525 | |
| Other operating expenses | -12,924 | -13,060 | |
| Staff costs | -11,716 | -11,251 | |
| Depreciation, amortisation and impairment losses | -2,849 | -2,710 | |
| Other expenses | -229 | -264 | |
| Operating profit | 2,936 | 989 | |
| Finance income | 8 | 5 | |
| Finance costs | -283 | -333 | |
| Finance income on shares of associates | 47 | 46 | |
| Profit before tax | 2,708 | 707 | |
| Income tax expense | -3,873 | -1,324 | |
| NET LOSS FOR THE FINANCIAL YEAR | -1,165 | -617 | |
| Other comprehensive income: | |||
| Items that may be subsequently reclassified to profit or loss | |||
| Currency translation differences | 0 | 2 | |
| Other comprehensive income for the financial year | 0 | 2 | |
| TOTAL COMPREHENSIVE LOSS FOR THE FINANCIAL YEAR | -1,165 | -615 | |
Raul Puusepp
Chairman of the Board
Phone +372 731 5000
