WULFF GROUP PLC'S FINANCIAL STATEMENTS RELEASE JANUARY 1 – DECEMBER 31, 2017

FINANCIAL STATEMENTS RELEASE      FEBRUARY 22, 2018 at 9.00 A.M. 

EBITDA and operating profit grew in the final quarter of the financial year 

This is a summary of Wulff Group Plc’s Financial Statements Release January 1 – December 2017. The complete report is attached to this stock exchange release as a pdf-file. The report is also available at the website www.wulff-group.com.

1.10. – 31.12.2017 BRIEFLY

  • Net sales totalled EUR 15.8 million (15.8), up 0.1%
  • EBITDA and comparable EBITDA were EUR 0.4 million (0.3), up 20.6%
  • Operating profit (EBIT) and comparable operating profit (EBIT) were EUR 0.3 million (0.2), up 32.6%
  • Earnings per share (EPS) were EUR 0.04 (0.04)

1.1.  – 31.12.2017 BRIEFLY

  • Net sales totalled EUR 56.9 million (59.3), down 4.0%
  • EBITDA was EUR 0.4 million (1.0). Comparable EBITDA was EUR 0.4 million (0.8)
  • Operating profit (EBIT) was EUR -0,0 million (0.6). Comparable operating profit (EBIT) was EUR -0,0 million (0.4)
  • Earnings per share (EPS) were EUR -0.03 (0.05)
  • Equity-to-assets ratio was 47.0 % (31.12.2016: 50.5)
  • The Board proposes to the Annual General Meeting to be held on April 5, 2018 that a dividend of EUR 0.05 per share be paid
  • Wulff estimates that the comparable operating profit will grow in 2018


WULFF GROUP PLC’S CEO HEIKKI VIENOLA

“Investing in our competitiveness and renewal shows in our result for 2017: EBITDA and operating profit are down from the previous year – and the last quarter of the financial year was positive regarding our net sales, EBITDA and operating profit. The final quarter of the year gives us a good starting point for 2018. We are especially delighted how our personnel, customers, and cooperation partners have received our new and updated strategy that we worked on last year: our mission is to make this world better one workplace at a time. We will bring more and more environmentally friendly and sustainable products to our customers. Better workdays are made by creating more pleasant, healthier, safer, more relaxing, more versatile, and more active workplaces; wherever people work now and in the future. We will ensure that everyday life and purchasing at the workplace run smoothly and people feel well at work.”

GROUP’S NET SALES AND RESULT PERFORMANCE

In 2017 net sales totalled EUR 56.9 million (59.3), and EUR 15.8 (15.8) million in the final quarter. Net sales decreased by 4.0% in January-December and grew 0.1% in the final quarter. The decline in net sales was a result of lost contracts and trimming of the product range, especially in the case of those products whose demand has diminished. Wulff will continue to invest strongly in the development of a new range of products for the workplace.

In January-December 2017 the gross margin amounted to EUR 19.2 million (20.5) being 33.8% (34.6), and EUR 5.3 million (5.3) in the final quarter being 33.6% (33.5). The gross margin percent decreased due to the concentration of demand on low margin products during the first half-year period. The continuous streamlining of procurement processes is one of Wulff’s most important measures to improve profitability. 

In January-December 2017 employee benefit expenses amounted to EUR 12.2 million (12.6), 21.5% (21.2) of net sales and EUR 3.2 million (3.2), 20.2% (20.1) of net sales in the fourth quarter. Other operating expenses amounted to EUR 6.8 million (7.4) in January-December 2017 being 11.9% (12.5) of net sales, and EUR 1.8 million (1.9), 11.2% (12.1), of net sales in the final quarter. Employee benefit and other operating expenses were still affected by the implemented cost-saving measures and development projects.  

In January-December 2017 EBITDA was EUR 0.4 million (1.0) being 0.6% (1.7) of net sales, and EUR 0.4 million (0.3) in the final quarter. In January-December 2017 the comparable EBITDA amounted to EUR 0.4 million (0.8), and EUR 0.4 million (0.4) in the fourth quarter. 2016 EBITDA included a profit of EUR 0.2 million from the sales of car stock in January-December. 2017 EBITDA did not include items affecting comparability.

Wulff adjusted its outlook for 2017 on September 20, 2017. Originally, the comparable operating profit was estimated to increase from 2016. In January-December 2017 the operating profit (EBIT) amounted to EUR -0.0 million (0.6) being -0.1% (1.0) of net sales, and EUR 0.3 million (0.2) in the final quarter. In January-December 2017 the comparable operating profit (EBIT) amounted to EUR -0.0 million (0.4) and EUR 0.3 million (0.2) in the fourth quarter. The January-December 2016 operating profit included a profit of EUR 0.2 million from the sales of car stock that affected comparability.

In January-December 2017 the financial income and expenses totalled (net) EUR -0.2 million (-0.2) including interest expenses of EUR -0.1 million (-0.2) and mainly currency-related other financial items (net) EUR -0.2 million (-0.0). In the final quarter, the financial income and expenses (net) totalled EUR -0.1 million (-0.0).

In January-December 2017 the result before taxes was EUR -0.2 million (0.4), and EUR 0.2 million (0.2) in the final quarter.

In January-December 2017 the net profit was EUR -0.2 million (0.3), and 0.3 million (0.2) in the final quarter.

Earnings per share (EPS) were EUR -0.03 (0.05) in January-December 2017, and EUR 0.04 (0.04) in the final quarter.


KEY FIGURES

IV  IV  I-IV  I-IV
EUR 1000  2017 2016 2017 2016
Net sales  15 829 15 811 56 931 59 304
Change in net sales, % 0.1% -14.9%  -4.0% -13.8%
EBITDA 372 308  354 998
EBITDA margin, %  2.3% 1.9%  0.6% 1.7%
Operating profit/loss  274 207  -33 583
Operating profit/loss margin, %  1.7% 1.3%  -0.1% 1.0%
Profit/Loss before taxes  170 198  -247 351
Profit/Loss before taxes margin, %  1.1% 1.3%  -0.4% 0.6%
Net profit/loss for the period attributable to equity holders of the parent company 274 231  -193 302
Net profit/loss for the period, %  1.7% 1.5%  -0.3% 0.5%
Earnings per share, EUR (diluted = non-diluted) 0.04 0.04  -0.03 0.05
Return on equity (ROE), % 2.4% 1.8%  -2.0% 2.5%
Return on investment (ROI), % -1.1% 1.6%  -1.1% 2.9%
Equity-to-assets ratio at the end of period, % 47.0% 50.5%  47.0% 50.5%
Debt-to-equity ratio at the end of period  19.8% 19.6%  19.8% 19.6%
Equity per share at the end of period, EUR * 1.64 1.78  1.64 1.78
Investments in non-current assets  16 203 429 319
Investments in non-current assets, % of net sales  0.1% 1.3%  0.8% 0.5%
Treasury shares held by the Group at the end of period  79 000 79 000  79 000 79 000
Treasury shares, % of total share capital and votes  1.2% 1.2%  1.2% 1.2%
Number of total issued shares at the end of period  6 607 628 6 607 628  6 607 628 6 607 628
Personnel on average during the period 198 207 198 214
Personnel at the end of period  195 203 195 203

* Equity attributable to the equity holders of the parent company / Number of shares excluding the acquired own shares.


RISKS AND UNCERTAINTIES IN THE NEAR FUTURE
 

The demand for office supplies is strongly affected by the general economic development and the industry’s tight competition. Business operations are also affected by normal business risks such as the success of the Group’s strategy and operative risks stemming from the personnel, logistics and IT environments. Approximately half of the Group’s net sales come from other than euro-currency countries. Fluctuation of the currencies affects the Group’s net result and balance sheet.

Part of the Group’s loan agreements have covenants that stipulate that the equity-to-assets ratio must be at least 35 percent and the interest-bearing liabilities/operating margin ratio at most 3.5 at the end of each reporting period. Covenants are reported yearly. At the end of the reporting period 31.12.2017 the Group’s equity-to-assets ratio was 47.0% (50.5). At the end of the reporting period the interest-bearing liabilities/operating margin covenant was 6.8 and was therefore exceeded as per the loan terms due to the negative result. The Group’s management negotiated with the financier at the end of 2017 and due to the breach of covenant the financier will collect a one-off compensation. Interest-bearing liabilities have been divided into short-term and long-term debts according to their repayment schedule that was in effect on December 31, 2017.  

SUBSEQUENT EVENTS

The Group has not had any significant subsequent events after the reporting period.

BOARD OF DIRECTORS’ PROPOSAL FOR THE ANNUAL RESULT

The Group’s parent company Wulff Group Plc’s distributable funds totalled EUR 1.5 million. The Group’s net result attributable to the parent company shareholders was EUR -0.2 million (0.3), i.e. EUR -0.03 per share (EUR 0.05 per share). The Board of Directors proposes to the Annual General Meeting to be held on April 5th, 2018 that a dividend of EUR 0.05 per share, i.e. EUR 0.3 million, be paid for the financial year 2017, and the remaining distributable funds be left in retained earnings in the shareholders’ equity.

MARKET SITUATION AND FUTURE OUTLOOK

Wulff is the most significant Nordic player in its field. Its aim is to lead the way, renew the field and be at the forefront of change. Wulff believes that the role of values and sustainability will come to have an increasingly important part in sourcing decisions and companies’ business partner selections in the future. With its new strategy, Wulff will build its competitiveness and make sure that it can offer customers what they want: solutions for making the everyday work life smoother and the world better one workplace at a time. The market traditionally understood as the office environment changes and develops rapidly. Competition is tough in the traditional market and the new market has a lot of opportunities. Wulff believes that the future is bright due to the strong, constantly developing new strategy, its active customer and partner networks, and its professional, committed personnel. The Group has an ongoing readiness to carry out new strategic acquisitions and as a listed company, Wulff is in a good position to be a more active player than its competitors.

The developing economic situation will enable Wulff’s business to develop positively. Wulff will improve the profitability of its operations and estimates that the comparable operating profit for 2018 will grow. In the industry, it is typical that the result and cash flow are generated in the last quarter.

WULFF GROUP PLC’S FINANCIAL REPORTING AND ANNUAL GENERAL MEETING 2018

Wulff Group Plc will release the following financial reports in 2018:

Statutory Financial Statements 2017 week 11/2018
Interim Report, January-March 2018 Thursday May 3, 2018
Interim Report, January-June 2018 Thursday August 2, 2018
Interim Report, January-September 2018 Thursday November 1, 2018

Wulff Group Plc’s Annual General Meeting will be held on Thursday April 5, 2018. A separate notice to the Annual General Meeting will be published prior to the meeting in 2018.

In Vantaa on February 21, 2018

WULFF GROUP PLC
BOARD OF DIRECTORS

Further information:
CEO Heikki Vienola
tel. +358 300 870 414 or  +358 50 65 110
email: heikki.vienola@wulff.fi  

DISTRIBUTION
NASDAQ OMX Helsinki Oy
Key media
www.wulff-group.com  

A BETTER WORLD – ONE WORKPLACE AT A TIME. Wulff enables working in environments where companies and entrepreneurs operate. We offer the industry’s most comprehensive product and service range that can help you create an office wherever you want it. What would you like? We offer our customers office supplies, facility management products, catering solutions, IT supplies, ergonomics, first aid, and innovative products for worksites. Customers can also acquire international exhibition services from Wulff. In addition to Finland, Wulff operates in Sweden, Norway, and Denmark. Check out our products and services at wulff.fi.   

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