Tikkurila as an investment
A leading player in its region
- Tikkurila is a strong regional player which focuses on the Nordic countries, Russia, Central Asia and China. The most important markets are Sweden, Finland, Russia and Poland, which account for approximately 80 percent of the Group’s revenue.
- Tikkurila is the market leader in decorative paints in Sweden, Finland, Russia and the Baltic countries. Tikkurila relies on strong brands, sustainable products which support the life cycle philosophy as well as on providing expert services to its customers. Strong brands and market leadership are the company’s key competitive advantages.
- Tikkurila focuses on premium paints, which are manufactured in 11 production units in eight countries. The highest production capacity is located in Russia, where the company has been operating since the 1970s.
- Tikkurila’s customers comprise consumers and professionals. A significant portion of the Group’s revenue is generated by the sales of decorative paints. Furthermore, Tikkurila serves customers in the wood and metal industries. Tikkurila’s operations are largely based on consumer business as well as renovation and repair, which greatly reduces the company’s sensitivity to economic fluctuations.
Solid financial position
- Strong balance sheet and stable profitability over business cycles
Stable dividend flow: historical dividends have corresponded to 69–88% of the operative net income.
- 2010 EUR 0.70 per share
2011 EUR 0.73 per share
2012 EUR 0.76 per share
- 2013 EUR 0.80 per share
- 2014 EUR 0.80 per share
- 2015 EUR 0.80 per share
- 2016 EUR 0.80 per share
Tikkurila's long-term financial targets
- Revenue: Revenue EUR 1 billion
- Relative profitability: Adjusted operating profit margin over 12 percent
- Return on capital: Operative return on capital employed (ROCE) over 20 percent
- Balance Sheet structure: Gearing less than 70 percent
Market trends provide opportunities
The growth in paint consumption has historically correlated with an increase in the standard of living. The market in Western Europe is relatively mature and there the paint consumption per capita is 8–15 liters. In Central Eastern Europe as well as in the CIS countries, the current decorative paint consumption per capita is significantly lower than in Western Europe. In Russia, for instance, the per capita paint consumption is some 6 liters. The consumption is expected to pick up in Central Eastern Europe and the CIS area as the standard of living increases. Moreover, the improving standard of living in the emerging economies is expected to increase the relative share on higher quality and price category paints.