Panostaja Oyj´s Business Review Q3 1.11.2018-31.7.2019
Panostaja Oyj Business Review Q3 September 5, 2019 10.00 a.m.
Net sales development weaker than expected during the summer – segments continue their corrective measures
May 1, 2019-July 31, 2019 (3 months)
- Panostaja sold KL-Varaosat Oy to Kaha Ab. MEUR 2.7 was recorded for the trade before taxes.
- Grano’s net sales for the review period dropped from the previous year, with the EBIT standing at MEUR 0.0 (MEUR 1.8). Grano’s review period includes a MEUR 0.9 depreciation, and the profit/loss for the reference period includes MEUR 0.4 in profits from the sale of fixed assets.
- Net sales increased in three of the eight segments. Net sales for the Group as a whole dropped by 7.3% to MEUR 45.0 (MEUR 48.5).
- EBIT improved in three of the eight segments, and the entire Group’s EBIT weakened substantially from the reference period, standing at MEUR 0.0 (MEUR 1.0).
- Earnings per share (undiluted) were 3.6 cents (-0.0 cents).
November 1, 2018-July 31, 2019 (9 months)
- Net sales increased in three of the eight segments. Net sales for the Group as a whole increased by 6% to MEUR 140.5 (MEUR 132.5).
- EBIT improved in three of the eight investment targets, but the EBIT of the entire Group declined from MEUR 4.2 to MEUR 2.1.
- Earnings per share (undiluted) were 3.7 cents (51.3 cents).
CEO Tapio Tommila:
“At the beginning of the review period, we made an agreement on selling the majority of KL-Parts Oy’s share capital to Oy Kaha Ab. The trade involved Panostaja divesting its entire 75% shareholding in KL-Parts Oy and recording MEUR 2.7 in sales profit for the trade before taxes. The arrangement was a good conclusion to our long-term development efforts, and it significantly bolstered our cash balance.
During the review period, the total net sales of the segments dropped by 7.3% and EBIT declined from the reference period to MEUR 0.0 (MEUR 1.0). One of the significant factors that dragged down the EBIT during the review period was a MEUR 0.9 depreciation related to the rearrangements of Grano’s ERP systems. Overall, the development of net sales and profitability in the third quarter of the financial period was weaker than we anticipated.
For Grano, the net sales and EBIT were lower than expected during the review period. After the spring which got off to a good start, the main reason for the development was the month of June, during which volumes dropped across all product areas. In order to ensure competitiveness and improve profitability, Grano reworked its operating model and organizational structure over the course of the review period. After the review period, the company initiated employer-employee negotiations that may lead to the full-time or part-time lay-off or dismissal of up to 140 people.
The net sales of Carrot and Selog, which suffered from poor net sales development early on in the financial period, fell short of the target level, but Carrot’s net sales recovered enough to end up positive. In these companies, the management has pushed measures to increase net sales, and we will continue to monitor the efficacy of the measures to ensure that this happens. The most significant improvement in profit/loss during the review period was achieved by CoreHW, which has maintained a good level of demand for customer projects.
The corporate acquisitions market remained active in the period under review, and the availability of new opportunities has been high. The markets still provide opportunities for both new acquisitions and divestments.”
| KEY FIGURES MEUR | Q3 | Q3 | 9 months | 9 months | 12 months |
| 5/19- 7/19 | 5/18- 7/18 | 11/18– 7/19 | 11/17– 7/18 | 11/17– 10/18 | |
| Net sales, MEUR | 45.0 | 48.5 | 140.5 | 132.5 | 185.2 |
| EBIT, MEUR | 0.0 | 1.0 | 2.1 | 4.2 | 4.1 |
| Profit before taxes, MEUR | -0.5 | 0.4 | 0.7 | 2.7 | 1.5 |
| Profit/loss for the financial period, MEUR | 1.7 | 0.5 | 2.1 | 28.7 | 27.1 |
| Distribution: | |||||
| Shareholders of the parent company | 1.9 | 0.0 | 1.9 | 26.7 | 24.1 |
| Minority shareholders | -0.2 | 0.5 | 0.2 | 2.0 | 3.0 |
| Earnings per share, undiluted (EUR) | 0.04 | 0.00 | 0.04 | 0.51 | 0.46 |
| Interest-bearing net liabilities | 54.6 | 59.4 | 54.6 | 59.4 | 58.1 |
| Gearing ratio, % | 68.4 | 69.3 | 68.4 | 69.3 | 69.0 |
| Equity ratio, % | 42.6 | 41.1 | 42.6 | 41.1 | 40.4 |
| Equity per share (EUR) | 1.00 | 1.06 | 1.00 | 1.06 | 1.02 |
| Division of the net sales by segment MEUR | Q3 | Q3 | 9 months | 9 months | 12 months |
| Net sales | 5/19- 7/19 | 5/18- 7/18 | 11/18– 7/19 | 11/17– 7/18 | 11/17– 10/18 |
| Grano | 29.6 | 32.1 | 96.4 | 100.9 | 136.6 |
| Selog | 2.0 | 2.5 | 5.4 | 6.8 | 9.4 |
| Helakeskus | 2.0 | 1.9 | 5.9 | 6.0 | 8.2 |
| Hygga | 1.2 | 1.3 | 3.6 | 4.0 | 5.4 |
| Heatmasters | 1.0 | 1.3 | 2.6 | 3.5 | 4.8 |
| CoreHW | 1.2 | 0.7 | 3.8 | 2.5 | 3.7 |
| Carrot | 5.6 | 6.7 | 15.5 | 6.7 | 13.0 |
| Oscar Software | 2.5 | 2.1 | 7.6 | 2.1 | 4.4 |
| Others | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Eliminations | -0.1 | -0.1 | -0.2 | -0.1 | -0.2 |
| Group in total | 45.0 | 48.5 | 140.5 | 132.5 | 185.2 |
| Division of EBIT by segment MEUR | Q3 | Q3 | 9 months | 9 months | 12 months |
| EBIT | 5/19- 7/19 | 5/18- 7/18 | 11/18– 7/19 | 11/17– 7/18 | 11/17– 10/18 |
| Grano | 0.0 | 1.8 | 2.3 | 5.8 | 8.4 |
| Selog | 0.0 | 0.2 | 0.0 | 0.4 | 0.8 |
| Helakeskus | 0.1 | 0.1 | 0.3 | 0.2 | -2.7 |
| Hygga | 0.0 | 0.1 | -0.1 | -0.1 | -0.2 |
| Heatmasters | 0.0 | 0.2 | -0.1 | 0.1 | 0.2 |
| CoreHW | 0.1 | -0.1 | 0.1 | -0.6 | -0.6 |
| Carrot | 0.1 | -0.2 | -0.5 | -0.2 | -0.1 |
| Oscar Software | 0.1 | 0.0 | 0.3 | 0.0 | 0.1 |
| Others | -0.5 | -1.0 | -0.3 | -1.3 | -1.8 |
| Group in total | 0.0 | 1.0 | 2.1 | 4.2 | 4.1 |
Panostaja Group’s business operations for the current review period are reported in nine segments: Grano, Selog, Helakeskus, Heatmasters, Hygga, CoreHW, Carrot, Oscar Software and Others (parent company and associated companies).
In the review period, two associated companies, Gugguu Group Oy and Spectra Yhtiöt Oy, issued reports to the parent company. The result of the reported associated companies has developed well and its impact on profit/loss in the review period was MEUR 0.1 (MEUR 0.3 in the reference period, including the profit/loss impact of Ecosir Group), which is presented on a separate row under the EBIT in the consolidated income statement.
Outlook for the 2019 Financial Period
The corporate acquisitions market remained active in the period under review, and the availability of new opportunities has been good. The need to exploit ownership arrangements and growth opportunities in SMEs will continue, and as our own activity complements the supply of possible acquisitions from outside, there are plenty of possibilities for corporate acquisitions on the market. Panostaja aims to implement its growth strategy by means of controlled acquisitions in current investments, and new potential investments are also being actively studied. Divestment possibilities will also be assessed as part of the ownership strategies of the investment targets.
It is thought that the demand situation for different investments will develop in the short term as follows:
- The demand for CoreHW, Oscar Software, Carrot and Heatmasters will remain good.
- The demand for Grano and Hygga will remain satisfactory. The demand for Selog and Helakeskus will decline to a satisfactory level (previously good).
Panostaja Oyj
Board of Directors
For further information, contact CEO Tapio Tommila, +358 (0)40 527 6311
Panostaja Oyj
Tapio Tommila
CEO
This is not an interim report compliant with the IAS 34 standard. The company observes the six-monthly reporting practice prescribed in the Finnish Securities Markets Act and publishes business reviews for the initial three and nine months of each year, presenting the key information on the company’s financial development. The financial information presented in the business review has not been audited.
Panostaja is an investment company developing Finnish start-ups in the role of an active shareholder. The company aims to be the most sought-after partner for business owners selling their companies as well as for the best managers and investors. Together with its partners, Panostaja strives to increase shareholder value and create Finnish success stories.
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