Tikkurila Oyj
Stock Exchange Release
February 9, 2016 at 9:00 a.m. (CET+1)
Tikkurila's Financial Statement Release for January-December 2015
- Relative profitability was good and stable despite the market challenges
Full-year 2015 highlights
- Revenue decreased by 5.5 percent to EUR 584.1 million (2014: EUR 618.4 million).
- Operating profit (EBIT) excluding non-recurring items was EUR 58.9 (64.2) million, i.e. 10.1 (10.4) percent of revenue.
- Operating profit (EBIT) was EUR 61.7 (63.7) million, i.e. 10.6 (10.3) percent of revenue.
- EPS was EUR 0.94 (1.10).
- Cash flow after capital expenditure was EUR 32.6 (49.9) million.
October-December 2015 highlights
- Revenue decreased by 0.9 percent to EUR 103.4 million (10-12/2014: EUR 104.4 million).
- Operating result (EBIT) excluding non-recurring items was EUR -11.1 (-13.2) million, i.e. -10.7 (-12.6) percent of revenue.
- Operating result (EBIT) was EUR -10.3 (-13.9) million, i.e. -9.9 (-13.3) percent of revenue.
- EPS was EUR -0.25 (-0.19).
Dividend proposal
- The Board proposes a dividend of EUR 0.80 (0.80) per share, which corresponds to about 85 (73) percent of the Group's 2015 earnings per share.
Revenue and EBIT estimates for 2016
- Tikkurila expects its revenue for the financial year 2016, with exchange rates as of the publication date of the financial statement release, to be at the same level as in 2015. EBIT excluding non-recurring items is expected to stay at 2015 level.
| Key figures | ||||||
| (EUR million) | 10-12 /2015 | 10-12 /2014 | Change % | 1-12 /2015 | 1-12 /2014 | Change % |
| Income statement | ||||||
| Revenue | 103.4 | 104.4 | -0.9% | 584.1 | 618.4 | -5.5% |
| Operating profit (EBIT), excluding non-recurring items | -11.1 | -13.2 | 16.1% | 58.9 | 64.2 | -8.2% |
| Operating profit (EBIT) margin, excluding non-recurring items, % | -10.7% | -12.6% | 10.1% | 10.4% | ||
| Operating profit (EBIT) | -10.3 | -13.9 | 25.9% | 61.7 | 63.7 | -3.2% |
| Operating profit (EBIT) margin, % | -9.9% | -13.3% | 10.6% | 10.3% | ||
| Profit before taxes | -13.7 | -9.7 | -41.9% | 52.8 | 63.3 | -16.6% |
| Net profit for the period | -11.0 | -8.2 | -33.3% | 41.5 | 48.3 | -14.0% |
| Other key indicators | ||||||
| EPS, EUR | -0.25 | -0.19 | -33.1% | 0.94 | 1.10 | -14.1% |
| ROCE, %, rolling | 22.2% | 22.9% | 22.2% | 22.9% | ||
| Cash flow after capital expenditure | -1.6 | 7.6 | 32.6 | 49.9 | -34.5% | |
| Net interest-bearing debt at period-end | 46.2 | 47.4 | -2.4% | |||
| Gearing, % | 23.7% | 24.6% | ||||
| Equity ratio, % | 51.1% | 49.5% | ||||
| Personnel at period-end | 3,100 | 3,142 | -1.3% |
Comments by Erkki Järvinen, President and CEO:
"Revenue in the last quarter of the year was at the comparison period level and operating loss decreased. This improvement was due to the sales price increases implemented in Russia and the good development in China.
The last quarter did not change the overview for the full year. The performance of markets which experienced a boost during the year, such as Sweden, Poland, the Baltic countries and China, continued to be strong. Growth in the national economies of Sweden and Poland is among the strongest in the EU region, which also reflected favorably in the paint market. Our growth in these countries has also been supported by our own efforts to boost market demand. Our sales volumes grew strongly in China, where we extended the retail network with 100 new stores opened during the year by our partners. We believe that the strong development will continue in these markets also in the future.
The euro-denominated revenue for the entire year decreased by six percent, but the comparable revenue grew. Our relative profitability remained at the previous year's level. We have to be satisfied with this achievement, considering the difficult market conditions in the east. No turn for the better is to be expected in the Russian situation in the near future. The exchange rate of the ruble continued to decline at the beginning of the current year, consumers' purchasing power shrank and the market shares of import products have decreased. In light of these factors, we will work to further increase local manufacturing and raw material purchasing in Russia and its neighboring regions in the future in order to secure sales and profitability.
Despite the challenges related to the market environment, our aim is to grow. Growth is being actively sought in different geographical areas and various product groups. To support our growth objective, we have modified the structure of the company and streamlined our operating methods in the recent years. We expect 2016 revenue, with exchange rates as of the publication date of the financial statement release, to remain at the same level as in 2015. EBIT excluding non-recurring items is expected to stay at 2015 level."
Outlook for 2016
Growth in the EU region is forecasted to be steady but fairly low. The importance of the Western markets, particularly Sweden and Poland, is expected to increase further. The weak economic situation in Russia and the low level of ruble will make the operating environment difficult in 2016. In Russia, paint demand is expected to decrease and the relative market share of the lower price and quality grade products is expected to grow. Tikkurila is planning to increase its prices primarily in Russia, as well as to increase local manufacturing and raw material purchasing. Sales and marketing investments will continue in the previous years' manner in order to strengthen the market position. At the same time, increased operational efficiency and cost savings will be actively sought in all operations.
Guidance for 2016
Tikkurila expects its revenue for the financial year 2016, with exchange rates as of the publication date of the financial statement release, to be at the same level as in 2015. EBIT excluding non-recurring items is expected to stay at 2015 level.
Board of Directors' proposal for the distribution of profit
Tikkurila Oyj's distributable equity totaled EUR 157.8 million on December 31, 2015: reserve for invested unrestricted equity totaled EUR 40.0 million and retained earnings totaled EUR 117.8 million. The Board proposes to the Annual General Meeting that a dividend of EUR 0.80 per share will be distributed for the year ended on December 31, 2015, and that the rest be retained in the unrestricted equity. The proposed dividend totals about EUR 35.3 million, which corresponds to approximately 85 percent of the Group's net profit for 2015. It is proposed that the record date for the payment of the dividend will be April 8, 2016, and that the dividend will be paid on April 15, 2016.
Press Conference and webcast
Tikkurila will hold a press conference regarding the Financial Statement Release for 2015 for the media and analysts today on February 9, 2016, at 12:00 p.m. (CET+1) in the Akseli Gallén-Kallela Cabinet at the Hotel Kämp (address Pohjoisesplanadi 29, 00100 Helsinki). The conference will be held in Finnish language. Attendees will be served lunch at the conference premises starting at 11:30 (CET+1). The Financial Statement Release will be presented by Erkki Järvinen, President and CEO and Jukka Havia, CFO.
A live webcast, conducted in English, will be organized on February 9, 2016, at 3:00 p.m. The live webcast will be available at www.tikkurilagroup.com. The participants can also join a telephone conference that will be arranged in conjunction with the live webcast. The telephone conference details are set out below:
+358 9 6937 9590 (Finnish callers)
+44 20 3427 1919 (UK callers)
+1212 444 0412 (US callers)
Participant code: 2434440
An on-demand version of the webcast will be available at www.tikkurilagroup.com/investors later during the same day.
The Financial Statement Release and presentation materials will be available before the event at www.tikkurilagroup.com/investors.
Tikkurila Oyj
Erkki Järvinen, President and CEO
For further information, please contact:
Erkki Järvinen, President and CEO
Mobile +358 400 455 913, erkki.jarvinen@tikkurila.com
Jukka Havia, CFO
Mobile +358 50 355 3757, jukka.havia@tikkurila.com
Minna Avellan, Director, Investor Relations and Brand Concept Development
Mobile +358 40 533 7932, minna.avellan@tikkurila.com
Tikkurila is the leading paints and coatings professional in the Nordic region and Russia. With our roots in Finland, we now operate in 16 countries. Our high-quality products and extensive services ensure the best possible user experience in the market. Sustainable beauty since 1862.
HUG#1984542
