– The Tulikivi Group’s net sales were EUR 7.2 million (EUR 9.1 million, 7–9/2023) in the third quarter and EUR 25.0 million (EUR 35.4 million, 1–9/2023) in the review period.
– The Tulikivi Group’s operating profit was EUR 0.5 (1.3) million in the third quarter and EUR 1.6 (4.9) million in the review period.
– The Tulikivi Group’s profit before taxes was EUR 0.3 million (1.1 million) in the third quarter and EUR 1.0 (4.4) million in the review period.
– The equity ratio at the end of the review period was 50.9 per cent (47.5).
– Order books stood at EUR 3.1 (11.5) million at the end of the review period.
– The Suomussalmi talc project made good progress
– Future outlook: Net sales in 2024 are expected to be EUR 33 to 37 million and the comparable operating profit is expected to be EUR 2 to 3 million.

Comments by Heikki Vauhkonen, Managing Director

In the third quarter, net sales declined significantly from the exceptionally high figures the year before as market recovery was slower than anticipated, particularly in Germany. Despite the decline in net sales, the relative profitability for the year was at a satisfactory level. This profitability was made possible by the role of exports in net sales and good cost control.

During the period under review, Tulikivi advanced its strategic projects as planned. The strategic projects are to grow the market share in the Central European fireplace market, to increase the net sales of the sauna business, and advance the Suomussalmi talc project to the investment stage.

In Central Europe, the expansion of the sales and distribution network for the new compact Jero collection continued. Consumers in Central Europe prefer products in the stove-size range, and the new Jero collection will enable Tulikivi to reach new customer groups. The aim is to increase the total number of dealers by 50 per cent from 330, the number at the end of 2023, by the end of 2026. Another aim is for all sales offices to offer the Jero collection. The number of sales offices has increased by more than 10 per cent in 2024.

During the review period, the Jero collection received product safety approval for the US market. Thanks to its advanced combustion technology, the collection was approved for consumer investment subsidies in Italy. These approvals facilitate the expansion of the sales and distribution network.

The sauna business focused on launching a new collection of electric sauna heaters on the market. The collection highlights the great features of Tulikivi sauna heaters: high-quality design, energy efficiency, original materials and safety. In addition, the sauna organisation was strengthened with the appointment of Mikko Kuoppa as Head of Sauna Business.

The plans and studies completed for the Suomussalmi talc project during the period under review reinforced confidence in the project’s economic competitiveness. The updated quarrying plan and the schedule suggest that the amount of adjoining rock will be significantly less than the amount of ore, and that the ratio can be kept constant over the life of the mine. Competitiveness is supported by the planned modern enrichment plant, which could be located in the immediate vicinity of the quarry. The project’s conditions will also be positively influenced by the price level of the European talc market and its development.

The Kainuu Centre for Economic Development, Transport and the Environment (ELY), the contact authority, gave public notice of the environmental impact assessment (EIA report) of the Suomussalmi talc deposit exploitation project in July 2024. The period of the notice ended at the end of August, and we expect to receive the contact authority’s reasoned conclusion in November.

During the past quarter, the company has continued work on the reports and plans required for the environmental permit application. The company and the local electricity distribution network operator have continued the nature inventories and environmental assessments required for a new transmission line. The new transmission line would provide Nordic Talc with the power needed for its production operations.

TULIKIVI CORPORATION

Board of Directors

Distribution: NASDAQ OMX Helsinki
Key media
www.tulikivi.com

Additional information: Heikki Vauhkonen, Managing Director, tel. +358 (0)40 524 5593

ATTACHEMENT: Interim Report 1-9/2024

Comments by Heikki Vauhkonen, Managing Director:

Net sales for the first half of the year declined notably from the year before, when they were exceptionally high. Despite the decline in net sales, the relative profitability for the first half of the year remained at a satisfactory level. This profitability was made possible by the role of exports in sales, good cost control and successful profitability measures.

During the period under review, Tulikivi moved forward with its strategic projects. They are to grow the market share in the Central European fireplace market, to increase the net sales of the sauna business, and move the Suomussalmi talc project forward to the investment stage.

In Central Europe, the expansion of the distribution network for the new compact Jero collection continued. Consumers in Central Europe prefer products in the stove-size range, and the new Jero collection will enable Tulikivi to reach new customer groups. Tulikivi has around 350 distributors in export countries. The aim is to launch sales of the Jero collection in all sales offices and increase the total number of dealers by 50% by the end of 2026. During the review period, the Jero collection received product safety approval for the US market. Thanks to its advanced combustion technology, the collection was approved for consumer investment subsidies in Italy.

The sauna business focused on launching a new collection of electric sauna heaters on the market. The collection highlights the great features of Tulikivi sauna heaters: high-quality design, energy efficiency, original materials and safety. The collection has received good feedback from customers and a follow-up to its launch is being prepared for the upcoming Habitare fair and the international Interbad fair.

The plans and studies completed for the Suomussalmi talc project during the period under review reinforced confidence in the project’s economic competitiveness. The updated quarrying plan and the schedule suggest that the amount of adjoining rock will be significantly less than the amount of ore, and that the ratio can be kept constant over the life of the mine. Competitiveness is supported by the planned modern enrichment plant, which could be located in the immediate vicinity of the quarry. The project’s conditions will also be positively influenced by the price level of the European talc market and its development.

The company submitted an environmental impact assessment report (EIA report) for the Suomussalmi talc deposit exploitation project to the Kainuu Centre for Economic Development, Transport and the Environment (ELY), the contact authority, on 27 June 2024, as planned.

In the second quarter, the company’s order intake was EUR 8.2 (11.3) million. In the first half of the previous winter, demand was increased by the high energy prices and the uncertainties related to energy availability.  The company’s order books normalised following the peak in demand in 2023 and came to EUR 3.5 (13.9) million at the end of the review period.

TULIKIVI CORPORATION

Board of Directors

Distribution: NASDAQ OMX Helsinki
Key media
www.tulikivigroup.com

Additional information: Heikki Vauhkonen, Managing Director, tel. +358 (0)40 524 5593

Strong profit growth continued

– The Tulikivi Group’s net sales were EUR 9.9 million (EUR 8.3 million, 7–9/2021) in the third quarter and EUR 30.5 million (EUR 24.1 million, 1–9/2021) in the review period.
– The Tulikivi Group’s operating profit was EUR 1.2 (1.0) million in the third quarter and EUR 3.2 (2.1) million in the review period.
– The Tulikivi Group’s profit before taxes was EUR 1.1 million (0.8 million) in the third quarter and EUR 2.6 (1.6) million in the review period.
– Net cash flow from operating activities was EUR 1.3 (1.2) million in the third quarter and EUR 3.5 (1.9) million in the review period.
– Order books strengthened significantly in the third quarter and stood at EUR 15.8 (5.9) million at the end of the review period.
– Erkki Kuronen was appointed Managing Director of Nordic Talc Oy, a part of the Tulikivi Group, on 16 September 2022.
– Future outlook: Net sales in 2022 are expected to be EUR 42 to 45 million and the comparable operating profit is expected to be EUR 4.0 to 5.0 million.

Comments by Heikki Vauhkonen, Managing Director

The company’s order intake increased 64 per cent in the third quarter year-on-year and totalled EUR 14.9 (9.1) million. Demand increased in Scandinavia, as well as in Central Europe, due to the sharp increase in electricity prices. In the principal market area the strong rise in heating energy prices and the increased uncertainty surrounding the availability of energy and homes’ security of supply further increased consumers’ interest in purchasing alternative heating systems, such as a fireplace.

The growth in sales was also attributable to systematic long-term work to renew the product portfolio, development of online sales and the streamlining of distribution channels in export markets. Tulikivi’s order books grew and amounted to EUR 15.8 (5.9) million at the end of the review period.

Profitability improved despite the continued steep rises in the prices of steel, purchased components and energy over the review period, 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 ceramic colour options introduced in the Karelia collection late last year, as well as the Kermansavi collection based on 80 per cent recycled material, have been well received on the market. The new ceramic collections, which meet the Ecodesign requirements that came into force on 1 January 2022, have strengthened Tulikivi’s market position in Finland and have expanded the potential customer base in the export markets. The collaboration with the German cooperative Hagos eG, which is rich in tradition and focuses on fireplaces and their accessories, has been launched as planned.

Erkki Kuronen was appointed Managing Director of Nordic Talc Oy, a part of the Tulikivi Group, on 16 September 2022. Kuronen has 20 years of expertise in talc deposits and operations from Mondo Minerals and valuable experience from the financing and launch of the Sotkamo Silver mine and the start-up of its production operations. The objective of Nordic Talc Oy is the industrial exploitation of Tulikivi’s talc reserves in the Suomussalmi mining district.

In addition, Tulikivi carried out additional drilling and surveys and updated the JORC mineral resource estimate for the Haaponen talc deposit in the mining district of its Suomussalmi plant. The mineral resources in Suomussalmi increased by 10 million tonnes on the previous estimate. According to the report, the indicated mineral resources of the Haaponen deposit are 22.3 million tonnes and their average talc content is 44.4 per cent.

TULIKIVI CORPORATION

Board of Directors

Distribution: NASDAQ OMX Helsinki
Key media
www.tulikivi.com

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

ATTACHEMENT: Interim Report 1-9/2022