Interim report 1–3/2023: Strong export growth continued

– The Tulikivi Group’s first-quarter net sales were EUR 13.0 million (EUR 8.4 million, 1–3/2022).
– The Tulikivi Group’s first-quarter operating profit was EUR 1.3 (0.3) million and the profit before taxes was EUR 1.1 (0.2) million.
– The equity ratio at the end of the review period was 42.0 per cent (29.9).
– Order books stood at EUR 16.1 (10.5) million at the end of the review period.
– There were good results from the Suomussalmi talc enrichment tests.
– Future outlook: Net sales are expected to increase in 2023, and the comparable operating profit is expected to improve on 2022.

Comments by Heikki Vauhkonen, Managing Director:

Net sales growth was strong in the period under review, with growth primarily focused on Central European exports. The high heating energy prices in the autumn and the uncertainty related to the availability of energy and the security of supply of homes increased consumers’ interest in fireplaces, which affected deliveries during the review period.

In the first quarter, the company’s order intake was EUR 11.1 (12.2) million, and demand remained brisk in Central Europe and Scandinavia. Thanks to the strong intake, order books remained at a high level and amounted to EUR 16.1 (10.5) million at the end of the review period.

Despite the fact that the prices of purchased components continued to rise during the review period, profitability improved thanks to higher net sales, price increases and successful productivity measures. The company’s profitability is also supported by the fact that its operations are to a substantial degree based on the utilisation of its own soapstone reserves in Finland.

The strategic measures to expand the distribution network were continued in the first quarter. In Sweden, Tulikivi signed a distribution agreement with the Eldabutiken chain on the sale and marketing of the Karelia collection. The Eldabutiken chain has 50 stores. In Central Europe, sales and training activities were continued for the expansion of the distribution network of both Tulikivi and Kermansavi fireplaces.

In the early part of the year, product development focused on the new Jero collection. The products combine the technology of heat-retaining fireplaces with the compact size and modern design of a stove. The affordable and easy-to-install Jero collection was very well received at the international World of Fireplaces fair in Leipzig in April. In Central Europe, consumers prefer products in the stove-size range, and the collection will enable Tulikivi to reach new customer groups.

The enrichment tests that were started last year with Metso Corporation to verify the suitability of the talc for utilisation and to form the basis for the design of the enrichment plant, were completed in the Suomussalmi talc project. The enrichment tests confirm the view that the deposit can be used to produce talc products suitable for most applications, with a whiteness and talc content that matches or even exceeds the typical values of similar talc products on the market.

A EUR 1.6 million R&D loan was received from Business Finland for the project. The loan can be drawn down as the project progresses, between 2023 and 2025.

The technical design and environmental impact assessment (EIA) of the talc project proceeded during the quarter. The EIA report will be submitted to the Kainuu ELY Centre, which is the contact authority, in autumn this year.

TULIKIVI CORPORATION

Board of Directors

Distriburion: Nasdaq Helsinki
Key media
www.tulikivi.com

Further information: Heikki Vauhkonen, Managing Director, tel. +358 207 636 555