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Tikkurila’s Business Review January-March 2019 Profitability continued to improve

Tikkurila's euro-denominated revenue in the first quarter amounted to EUR 129.1 million (1-3/2018: 130.1), a decrease of 0.7 percent from the previous year's level. In local currencies, revenue increased by 2.4 percent. Adjusted operating profit improved to EUR 8.2 (3.6) million and amounted to 6.3 (2.8) percent of revenue.

25.04.2019

Tikkurila Oyj Business Review Q1 April 25, 2019 at 9.00 a.m. (CET+1)

"Revenue developed well in local currencies and increased especially in Poland and Russia. The euro-denominated revenue was at a slightly lower level than in the previous year in Sweden and Finland, where we postponed some pre-sales for the season to the second quarter as planned. Tikkurila’s sales volumes increased slightly (1%) in the first quarter.

Profitability improved from the comparison period: adjusted operating profit increased to EUR 8.2 (3.6) million. The fixed cost efficiency program was positively reflected in the profitability. We also continued sales price increases in the first quarter in order to compensate for the significant raw material inflation during the last year”, says Elisa Markula, CEO.

The euro-denominated revenue of SBU East increased by 7.9 percent. Profitability improved thanks to the revenue increase and cost savings. Excluding exchange rate fluctuations, revenue increased by 13 percent compared to the corresponding period a year ago.

In SBU West, revenue increased especially in Poland. In Sweden and Finland, revenue declined due to the postponement of pre-season sales to later in the spring. Excluding the impact of divestments and currency effects, revenue remained at the level of the comparison period. Profitability, however, improved.

Key figures 
(EUR million)  1-3/2019 1-3/2018 Change%
Group data 
Revenue  129.1 130.1 -0.7%
Operating profit  7.9 0.0
Adjusted operating profit 8.2 3.6 126.5%
Adjusted operating profit margin, %  6.3% 2.8%
Result for the period 7.4 -2.1
EPS, EUR  0.17 -0.05
Net interest-bearing liabilities (at period-end)  131.1 133.8 -2.0%
Total equity (at period-end)  160.5 173.5 -7.5%
Total assets (at period-end) 470.3 471.7 -0.3%
Segment data   
SBU West revenue   97.2 100.5 -3.3%
SBU West operating profit  10.5 3.4 213.2%
SBU West adjusted operating profit  10.6 7.3 45.7%
SBU East revenue  32.0 29.6 7.9%
SBU East operating result -0.7 -2.4 71.9%
SBU East adjusted operating result  -0.7 -2.7 74.9%
Revenue by country      
Sweden  31.2 35.7 -12.4%
Russia  21.8 21.0 4.0%
Finland  26.6 26.9 -1.3%
Poland  23.6 21.2 11.2%

IFRS 16 standard has been applied as of January 1, 2019. Historical figures have not been adjusted to IFRS 16 standard.

Cash flow after capital expenditure improved due to increased profitability and lower net working capital level. Net working capital decreased particularly due to lower inventory levels and increased trade payables. Gearing increased slightly compared to the comparison period, mainly because of the adoption of the IFRS16 standard.

Market share development in 2018

Tikkurila's market share in decorative paints remained strong in all market areas and there were no significant changes. The management estimates based on recently received data from last year that the market share has remained the same in Russia and Finland and increased in Poland and Sweden.

Guidance for 2019 unchanged

Tikkurila’s revenue is expected to remain at the same level as in 2018 and the adjusted operating profit will improve.

Tikkurila Oyj
Elisa Markula
CEO

For further information, please contact:

Elisa Markula, CEO
Mobile +358 50 596 0978,
elisa.markula@tikkurila.com  

Markus Melkko, CFO
Mobile. +358 40 531 1135,
markus.melkko@tikkurila.com

Tikkurila Investor Relations and Communications
ir.tikkurila@tikkurila.com