Published 19.12.2013

Tulikivi Corporation´s Financial Statements Release for 2013 will be published on February 10 , 2014. Annual Report will come out on Tulikivi’s website week 12. Annual General meeting will be held on April 2, 2014.

The following interim reports will be published in 2014:
– January – March           April 29
– January – June           August 8
– January – September         October 24

TULIKIVI CORPORATION

Heikki Vauhkonen
Managing Director

Distribution:
NASDAQ OMX Helsinki Ltd
Central Media
www.tulikivi.com

Published 26.11.2013

The Board of Directors of Tulikivi Corporation decided on 17 September 2013 to issue stock options to the Tulikivi Group key employees on the basis of the authorization granted by the Company’s Annual General Meeting held on 16 April 2013. The share subscription price for all stock options 2013 is EUR 0.33 per share (the share subscription price in the Company’s share issue announced on 8 October 2013). Each year dividends and equity returns will be deducted from the share subscription price.

A total of 1,800,000 new series A shares or existing series A shares held by the Company may be subscribed for with stock options 2013. The share subscription period, for stock option 2013A will be 1 May 2016—31 May 2018, for stock option 2013B, 1 May 2017—31 May 2019, and for stock option 2013C, 1 May 2018—31 May 2020. For vesting of each stock option class, the Board of Directors will establish financial targets related to the Company’s performance improvement program separately for each stock option class. The share subscription period for stock options 2013A will begin only if the targets established for the 2014 financial year’s Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) adjusted by non-recurring items are fulfilled.

The number of stock options 2013A is 580,000. The theoretical market value of one stock option 2013A is EUR 0.10 per stock option. The theoretical market value of the stock options 2013A is EUR 58,000 in total. The theoretical market value of one stock option has been calculated through the use of Black & Scholes stock option pricing model with the following input factors: share price EUR 0.32, share subscription price EUR 0.33, risk free interest rate 0.89%, validity of stock options approximately 4.5 years and volatility 37%. The theoretical market value of the stock options has not been adjusted downward for the probability of not fulfilling the targets established for the vesting criterion.

The terms and conditions of the Stock Options 2013 are available on the Company’s internet pages www.tulikivi.com.

TULIKIVI CORPORATION
Board of Directors

Distribution: NASDAQ OMX Helsinki Ltd
Key Media
www.tulikivi.com

Additional information: Tulikivi Corporation, FIN-83900 Juuka, www.tulikivi.com
– Heikki Vauhkonen, Managing Director, tel. +358 207 636 555
– Harri Suutari, Chairman of the Board of Directors, tel. +358 400 384 937

The codetermination negotiations regarding Tulikivi’s plans to reduce its workforce, introduce layoffs and reorganise the company’s functions were concluded today, the 6th November 2013. The negotiations concerned the company’s entire personnel.

Employer’s account of the measures to be implemented on the basis of the codetermination negotiations

76 employees will be made redundant and 10 employees will be laid off until further notice in connection with the centralisation of fireplace production at Juuka, the closure of ceramic tile manufacturing at Heinävesi, and the reorganisation of operations. During the upcoming year, the company may also introduce temporary layoffs, lasting a maximum of 90 days, concerning the entire personnel. The measures are being carried out in connection with economic and production-related reasons and the reorganisation of the company’s operations. The redundancies will be implemented in stages, with most being carried out by the end of 2013.

The above-mentioned personnel reductions and reorganisation of functions are part of the Tulikivi Corporation’s performance improvement programme. The measures are expected to result in non-recurring expenses of approximately EUR 2.5 million in the final quarter of 2013.

TULIKIVI CORPORATION

Heikki Vauhkonen
Managing Director

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

Additional information: Tulikivi Corporation, 83900 Juuka, www.tulikivi.com
– Heikki Vauhkonen, Managing Director, tel. +359 (0)207 636 555

– The Tulikivi Group’s third-quarter net sales were EUR 12.1 million (EUR 13.1 million, 7–9/2012), the operating profit in the third quarter was EUR 0.0 (0.4) million and the result before taxes was EUR -0.3 (0.2) million.
– The operating result before non-recurring expenses was EUR 0.6 (0.4) million.
– The Group’s net sales during the reporting period 1-9/2013 were EUR 31.9 million (EUR 37.0 million), the operating result EUR -2.5 (-0.4) million and the result before taxes EUR -3.3 (-1.1) million. The operating result before non-recurring expenses was EUR -1.9 (-0.4) million during the 1–9/2013 review period.
– Net cash flow from operating activities was EUR 0.2 (-3.7) million in the review period.
– Order books at the end of the period were at EUR 5.3 million (EUR 5.9 million on 30 September 2012).
– Future outlook: The demand for Tulikivi products is dependent on consumer confidence. Although new products will allow us to increase our market share, net sales will decline from the 2012 figure. The operating result for 2013 is expected to show a loss. In addition, measures taken under the performance improvement programme are anticipated to cause non-recurring expenses of EUR 2.5 million in the fourth quarter.

Summary of the interim report 1-9/2013.  The full interim report is attached to this release.

Key financial ratios
 1-9/
2013
 1-9/
2012
Change,
%
 1-12/
2012
 7-9/
2013
 7-9/
2012
Change,
%
Sales, MEUR
31.9
37.0
 -13.8
51.2
 12.1
 13.1
 -7.6
Operating profit/
loss, MEUR
 -2.5
 -0.4
 -525.0
 0.1
0.0
 0.4
 -100.0
Profit before tax,
MEUR
 -3.3
 -1.1
 -200.0
 -0.8
 -0.3
 0.2
 -250.0
Total comprehensive
income for the period,
MEUR
 -2.5
 -0.8
 -212.5
 -0.6
 -0.2
 0.1
 -300.0
Earnings per share,
Euro
 -0.07
 -0.02
 -250.0
 -0.02
 -0.01
 0.00
Net cash flow from
operating activities,
MEUR
 0.2
 -3.7
 0.1
Equity ratio, %
 30.1
 33.2
 35.2
Net indebtness
ratio, %
 136.9
 130.3
 112.9
Return on
investments, %
 – 7.9
 -1.0
0.3
 -0.1
 3.6
Comments by Heikki Vauhkonen, Managing Director:
Third-quarter export demand for Tulikivi’s products was similar to that of last year while domestic demand was lower.
Performance in the principal market areas of France, Germany and Russia was positive but correspondingly slower in other areas. In early October, Tulikivi opened its first consumer shop in Central Europe in Leipzig. Importers in France and Germany will also open new shops during the autumn. The Hiisi fireplace collection, launched last year, has become the best-selling product family in Central Europe.
In Finland low-rise housing construction and renovation has declined, and this has had an impact on the demand for fireplaces and interior stone products in the third quarter. However, compared to the year before, the decline was smaller than it was in the early part of this year.
Tulikivi’s production and fixed costs were adjusted to meet the lower net sales, which improved profitability in the third quarter. Working capital reduced as a result and net cash flow from operating activities improved.
On 8 August 2013 Tulikivi announced its performance improvement programme which aims at increasing operating profit by EUR 7 million by the end of 2015. Plans to rationalise production, reduce costs and boost sales have proceeded as previously reported. The codetermination negotiations launched in September on the reduction of a maximum of 90 persons will be completed in early November. The performance improvement programme is anticipated to cause non-recurring expenses of EUR 2.5 million in the fourth quarter of 2013. The measures taken under the programme will have a positive impact on productivity from the beginning of 2014.
Interim report 
Operating environment
The low level of low-rise housing construction and renovation projects has weakened demand for fireplaces in Finland. Demand has also been affected by a reduction in lending by banks and deteriorating consumer confidence.
The protracted European recession has reduced export sales during this year. In the second half of the year, demand for fireplaces has been satisfactory in Germany and France but weak in the Nordic countries. New construction and energy efficiency regulations based on EU regulation have given rise to uncertainty in the market and had an impact consumers’ decisions.
Order books at the end of the reporting period amounted to EUR 5.3 million (EUR 5.9 million on 30 September 2012).
Net sales and result
The Group´s third-quarter net sales totalled EUR 12.1 million (EUR 13.1 7–9/2012), the operating profit was EUR 0.0 (0.4) million and the result before taxes EUR -0.3 (0.2) million. Changes were made in Tulikivi’s management in the third quarter, resulting in a non-recurring cost of approximately EUR 0.6 million during the third quarter. The operating result before non-recurring expenses was EUR 0.6 million (0.4) in the third quarter. As a result of adjustments to production and a reduction of costs, relative profitability improved in the third quarter.
The Group’s net sales were EUR 31.9 million (37.0, 1–9/2012) during the 1–9/2013 review period. The operating result before non-recurring expenses was EUR -1.9 (-0.4) million during the period. The consolidated operating result was EUR -2.5 (-0.4) million for the period, and result before taxes was EUR -3.3 million (-1.1) million. Earnings per share amounted to EUR -0.07 (-0.02).
In the segment reporting, the corresponding operating result for the Fireplaces Business was EUR 29.1 (33.8) million, and for the Interior Stone Business EUR 2.8 (3.2) million. Net sales in Finland accounted for EUR 15.8 (18.7) million, or 49.5 (50.4) per cent, of total net sales. Exports amounted to EUR 16.1 (18.3) million in net sales. The principal export countries were France, Russia, Germany, Sweden and Belgium.
In the segment reporting, the corresponding operating result for the Fireplaces Business was EUR -2.4 (-0.3) million, and for the Interior Stone Business EUR -0.1 (-0.1) million.
 
Performance improvement programme
On 8 August 2013 Tulikivi issued a stock exchange release announcing a performance improvement programme which aims at increasing operating profit by EUR 7 million by the end of 2015. The programme includes measures to rationalise production, reduce costs and boost sales. The performance improvement programme also included changes to the company’s management, which have been carried out as announced in stock exchange releases issued on 23 August 2013 and 26 August 2013. Codetermination negotiations were also initiated in September, including talks to reduce a maximum of 90 employees and temporary layoffs affecting the entire personnel. The aim is to complete the codetermination negotiations in early November; the negotiations were announced in a separate stock exchange release was issued on 17 September 2013. The performance improvement programme is anticipated to cause non-recurring expenses of EUR 2.5 million in the fourth quarter of 2013. The performance improvement programme will have a positive impact on the company’s profitability from the beginning of 2014. In order to support the commitment of management and key personnel to the implementation of the performance improvement programme, the Board of Directors of Tulikivi Corporation decided on a new stock option programme, details of which are included in the stock exchange release issued on 17 September 2013.
 
Financing
Cash flow from operating activities before investments was EUR 0.2 (-3.7) million. Working capital decreased by EUR 0.6 (-5.5) million during the review period. Working capital was EUR 8.7 (12.0) million at the end of the review period. Interest-bearing debt was EUR 26.0 (26.0) million. Financial income was EUR 0.0 (0.1) million and financial expenses were EUR 0.8 (0.7) million. The equity ratio was 30.1 per cent (33.2 per cent on 30 September 2012). The ratio of interest-bearing net debt to equity, or gearing, was 137.3 (130.3) per cent. The current ratio was 1.4 (1.6). Equity per share was EUR 0.42 (0.49).
At the end of the reporting period, the Group’s cash and other liquid assets were EUR 4.6 (2.6) million. The total of undrawn credit facilities and unused credit limits amounted to EUR 0.0 (1.0) million.
The company has several financers with which it has separate credit agreements. The company’s credit agreements include financial covenants that concern the equity ratio and the ratio between the interest-bearing debt and EBITDA. The credit agreements also include repayment terms under which the breach of the terms of one credit agreement may result in the repayment of outstanding loans under other credit agreements. The company meets the covenants associated with the equity ratio as of 30 September 2013 and the management have assessed that the company will also meet the equity ratio covenants as of 31 December 2013.  The management estimates that the company will not meet the covenant regarding the ratio between Group interest bearing net debt and EBITDA on 31 December 2013. In addition, the company’s performance improvement programme will result in non-recurring expenses in the remaining part of 2013, and the management estimates that the company will not meet the covenant regarding the ratio between net debt and EBITDA as of 31 December 2013. Consequently, the company has negotiated a waiver from the covenant on the ratio of interest-bearing debt and EBITDA as of 31 December 2013. The company has also negotiated a waiver from the covenant on net debt and EBITDA as of 31 December 2013 under which a maximum of EUR 3 million in non-recurring expenses will not be included in covenant assessment. Negotiations with financers regarding the 2014 credit terms have been launched.
On 8 October 2013, the Board of Directors of Tulikivi Corporation decided on a share issue under the authorisation issued by the Annual General Meeting, in which the company will offer a maximum of 22,727,273 Series A shares in a directed rights issue to the public in Finland.
 The subscription price of the offered shares was EUR 0.33 per share. The subscription price includes the usual discount on the market price of the company’s Series A share. The subscription period of the shares offered started at 9.30 a.m. on 11 October 2013 and ended at 4.30 p.m. on 17 October 2013. The maximum number of the offered shares corresponded to approximately 61.2 per cent of the company’s stock and approximately 18.5 per cent of the votes attached to them before the share issue, and to approximately 38.0 per cent of the company’s total stock and approximately 15.6 per cent of the votes attached to them after the share issue, provided that the issue is subscribed in full. A number of Finnish institutional and other investors had committed to subscribe issued shares to a total maximum sum of EUR 6.1 million. The subscription commitments represented a maximum of approximately 81.74 per cent of the maximum number of the shares offered.
Tulikivi Corporation’s directed rights issue of approximately EUR 7.5 million was completed successfully on 17 October 2013. According to the final result, a total of 22,920,917 of the company’s Series A shares were subscribed, corresponding to some 101 per cent of the offered22,727,273 shares. On 21 October 2013 the company’s Board of Directors approved the subscriptions of 22,727,273 Series A shares under the terms of the share issue. All shares subscribed in the share issue have been paid in full. Shares subscribed in the share issue were registered in the Trade Register on 22 October 2013 and are traded on the NASDAQ OMX Helsinki Ltd exchange together with the company’s existing Series A shares as of 23 October 2013. As a result of registering the new shares in the Trade Register, the number of the company’s Series A shares will be 50,331,243. The number of the company’s Series K shares will remain at 9,540,000. The lead manager of the share issue is Pohjola Corporation Finance Ltd.
 
 
 
Investments
The Group’s investments in production, quarrying and development were EUR 1.1 (1.9) million in the reporting period. Research and development expenditure was EUR 1.2 (1.2) million, i.e. 3.8 (3.3) per cent of net sales. EUR 0.2 (0.4) million of this was capitalised in the balance sheet.
Product development focused on launching new models in the Hiisi product family. New woodburning and electric sauna heaters were also introduced to market in Russia and Finland.
 
Personnel
The Group employed an average of 295 (364) people during the reporting period. Salaries and bonuses during the period totalled EUR 9.4 (10.3) million.
The Tulikivi Group has an incentive pay scheme for all personnel. As the incentive pay scheme is based on a positive consolidated result, no incentive pay will be paid out on 2013.
Near-term risks and uncertainties
A substantial decline in euro zone consumer confidence is the Group’s most significant risk.  The decrease in new construction and renovation projects is affecting the demand for fireplaces.
The purpose of the share issue was to strengthen the company’s capital structure and to gain a more solid financial position.The funds from the share issue will be used to fund the company’s working capital and to rationalise production, renew and develop the product range and extend distribution in, for example,Russia and Germany under the company’s performance improvement programme.The funds from the share issue will also enable the company to make its normal credit instalments in accordance with the original schedule.
Even with the completion of the share issue, maintaining the company’s financing position at the present level and securing the continuation of financing will depend on an improvement in profitability in the future.The repayment of debt may cause a higher-than-anticipated burden on the company’s cash flow if the company’s business operations and result do not develop as well as expected.The company’s management will continuously evaluate and monitor the volume of financing available to operations to ensure that the company will have sufficient liquid funds to finance its operations and repay its maturing debt.Delays in the planned schedule of the performance improvement programme will cause a significant risk to the company’s profit performance.
Construction legislation is currently being revised in the EU.New country-specific energy efficiency provisions that meet the EU’s energy efficiency policies will come into force during 2013 and could influence the competition between different forms of heating and thus the demand for fireplaces in different markets.
A more comprehensive explanation of the Tulikivi Group’s other risks can be found under note 38: “Major risks and their management” in the Consolidated Financial Statements of the Annual Report for 2012.
Future outlook
 
The demand for Tulikivi products is dependent on consumer confidence. Although new products will allow us to increase our market share, net sales will decline from the 2012 figure. The operating result for 2013 is expected to show a loss. In addition, measures taken under the performance improvement programme are anticipated to cause non-recurring expenses of EUR 2.5 million in the fourth quarter.
TULIKIVI CORPORATION
Board of Directors
Distribution: NASDAQ OMX Helsinki
Key media
www.tulikivi.com
Additional information: Tulikivi Corporation, FIN-83900 Juuka, Finland, tel. +358 207 636 000, www.tulikivi.com
– Harri Suutari, Chairman of the Board, tel. +358 400 384 937
– Heikki Vauhkonen, Managing Director, tel. +358 207 636 555

On 21 October 2013, Tulikivi Corporation received a flagging announcement pursuant to Chapter 9, section 5 of the Securities Markets Act from  Mutul Insurance Company Pension Fennia and LocalTapiola Mutual Pension Insurance Company.

An announcement that Mutual Insurance Company Pension Fennia’s holding of Tulikivi Corporation stock has risen to a level that exceeds the threshold of 5 per cent of the stock following the share issue. Mutual Insurance Company Pension Fennia’s holding of 4,545,455 Tulikivi Corporation Series A shares, after the share issue, corresponds to 7.59 per cent of Tulikivi Corporation’s stock and less than 5 per cent of the votes.

Mutual Insurance Company Pension Fennia and LocalTapiola Mutual Pension Insurance Company will merge to form a new pension company on 1 January 2014. The new pension company’s name will be Elo Mutual Pension Insurance Company. The general meetings of the companies approved the merger on 19 June 2013, and the Financial Supervisory Authority gave its approval for the merger on 27 June 2013. The completion of the merger will mean a change in shareholding, whereby the new Elo Mutual Pension Insurance Company’s holding of Tulikivi Corporation’s shares, including the effect of the share issue being undertaken, will rise to exceed the 5 per cent threshold. Elo Mutual Pension Insurance Company’s holding will be 4,545,455 Tulikivi Corporation Series A shares, which will correspond to 7.59 per cent of Tulikivi Corporation’s stock and less than 5 per cent of the votes.

On October 21, 2013 the Tulikivi Corporation’s Board of Directors approved the subsciptions of  22,727,273 shares of the share issue, which expired on October 17, 2013.

TULIKIVI CORPORATION

Heikki Vauhkonen, Managing Director

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

Additional information: Tulikivi Corporation, FIN-83900 Juuka, Finland, tel. +358 207 636 000, www.tulikivi.com
– Heikki Vauhkonen, Managing Director, +358 207 636 555

On 22 October 2013, Tulikivi Corporation received a flagging announcement pursuant to Chapter 9, section 5 of the Securities Markets Act from Heikki Vauhkonen.

An announcement that Heikki Vauhkonen’s holding of Tulikivi Corporation shares has fallen to a level below the threshold of 15 per cent of the stock. Heikki Vauhkonen’s holdings of 1,025,853 Tulikivi Corporation Series A shares and 5,809,500 Series K shares will, after the share issue, correspond to 11.42 per cent of Tulikivi Corporation’s stock and 40.57 per cent of the votes.

On October 21, 2013 the Tulikivi Corporation’s Board of Directors approved the subsciptions of 22,727,273 shares of the share issue, which expired on October 17, 2013.

TULIKIVI CORPORATION
Heikki Vauhkonen, Managing Director
Distribution: NASDAQ OMX Helsinki
Key media
www.tulikivi.com
Additional information: Tulikivi Corporation, FIN-83900 Juuka, Finland, tel. +358 207 636 000, www.tulikivi.com
– Heikki Vauhkonen, Managing Director, +358 207 636 555

Not for publication or distribution, directly or indirectly, in or into the United States, Canada, Australia, Hong Kong, South Africa, Singapore or Japan or any other jurisdiction in which the distribution or release would be unlawful.

Tulikivi Corporation’s (the “Company”) directed share issue in a maximum amount of approximately EUR 7.5 million (the “Share Issue”) was completed successfully on 17 October 2013. According to the final results, 22,920,917 class A share of the Company were subscribed for corresponding to approximately 101 per cent of the offered 22,727,273 shares.

The Board of Directors of the Company has today approved subscriptions of 22,727,273 class A shares in accordance with the terms and conditions of the Share Issue. All shares subscribed for in the Share Issue have been fully paid for. The shares subscribed for in the Share Issue will be registered in the Finnish Trade Register on or about 22 October 2013 and they will be subject to public trading on the official list of NASDAQ OMX Helsinki Ltd. together with the other class A shares of the Company starting on or about 23 October 2013.

Following the registration of the new shares in the Finnish Trade Register, the number of class A shares will be 50,331,243. The number of class K shares will remain at 9,540,000.

Pohjola Corporate Finance Ltd is the lead manager of the Share Issue.

In Helsinki, on 21 October 2013

TULIKIVI CORPORATION

The Board of Directors

Additional information: Tulikivi Corporation, 83900 Juuka, tel. +358 403 063 100,
– CEO Heikki Vauhkonen, tel. +358 207 636 55
– Chairman of the Board of Directors Harri Suutari, tel. + 358 400 384 937

Distribution
NASDAQ OMX Helsinki
Key media

DISCLAIMER
The information contained herein is not for publication or distribution, directly or indirectly, in or into the United States, Canada, Australia, Hong Kong, South Africa, Singapore or Japan or any other jurisdiction in which the distribution or release would be unlawful. These written materials do not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. The Company does not intend to register any portion of the offering in the United States or to conduct a public offering of securities in the United States.

The issue, exercise and/or sale of securities in the offering are subject to specific legal or regulatory restrictions in certain jurisdictions. The Company and Pohjola Corporate Finance Oy assume no responsibility in the event there is a violation by any person of such restrictions.

The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable prospectus published by the Company.

The Company has not authorized any offer to the public of securities in any Member State of the European Economic Area other than Finland. With respect to each Member State of the European Economic Area other than Finland and which has implemented the Prospectus Directive (each, a “Relevant Member State”), no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in any Relevant Member State. As a result, the securities may only be offered in Relevant Member States (a) to legal entity which is a qualified investor as defined in article 2(1)(e) of the Prospectus Directive; or (b) in the United Kingdom to qualified investors who are: (i) investment professionals falling within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) order 2005 (the “Order”), or (ii) persons falling within article 49(2) (“high net worth companies, unincorporated associations, etc”) of the Order (all such persons together being referred to as “relevant persons”). Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents. For the purposes of this paragraph, the expression an “offer of securities to the public” means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to exercise, purchase or subscribe the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

Not for publication or distribution, directly or indirectly, in or into the United States, Canada, Australia, Hong Kong, South Africa, Singapore or Japan or any other jurisdiction in which the distribution or release would be unlawful.

Tulikivi Corporation’s (the “Company”) directed share issue in a maximum amount of approximately EUR 7.5 million (the “Share Issue”) was completed successfully on 17 October 2013. According to the preliminary results, 22,920,917 class A share of the Company were subscribed for corresponding to approximately 101 per cent of the offered 22,727,273 shares.

The Board of Directors of the Company will approve share subscriptions according to the terms and conditions of the Share Issue on 21 October 2013. The subscription price per share is EUR 0.33. As the Share Issue is, pursuant to the preliminary results oversubscribed, the shares will be allocated between the subscribers as follows: (1) firstly, to the issuers of subscription undertaking so that each issuer of subscription undertaking receives the number of shares corresponding to the issued subscription undertaking; and (2) secondly, so that the following are equally taken into account: (a) the subscriber’s portion of subscriptions for shares to be allocated, and (b) the ratio of the total number of the Company’s class A and class K shares held by the subscriber to the total number of class A and class K shares held by the subscribers of the shares to be allocated. The above-mentioned holdings of the subscribers are determined for allocation on the basis of the Company’s shareholder register maintained by Euroclear Finland Ltd on 11 October 2013. Where the allocation is not possible on the basis of the above, lots shall be drawn.

Should the Company not allocate all the shares contained in the subscriber’s subscription order, the Company will return the sum corresponding to the subscription price of the shares not received to the investor on or about 22 October 2013. No interest will be paid on the assets to be returned.

The Company will announce the final result of the Share Issue on 21 October 2013, following the approval of share subscriptions by the Board of Directors. The shares issued in the share issue will be registered in the Finnish Trade Register on or about 22 October 2013 and they will be subject to public trading on the official list of NASDAQ OMX Helsinki Ltd. together with the other class A shares of the Company starting on or about 23 October 2013.

Pohjola Corporate Finance Ltd is the lead manager of the share issue.

In Helsinki, on 18 October 2013

TULIKIVI CORPORATION

The Board of Directors

Additional information: Tulikivi Corporation, 83900 Juuka, tel. +358 403 063 100,
– CEO Heikki Vauhkonen, tel. +358 207 636 55
– Chairman of the Board of Directors Harri Suutari, tel. + 358 400 384 937

Distribution
NASDAQ OMX Helsinki
Key media

DISCLAIMER
The information contained herein is not for publication or distribution, directly or indirectly, in or into the United States, Canada, Australia, Hong Kong, South Africa, Singapore or Japan or any other jurisdiction in which the distribution or release would be unlawful. These written materials do not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. The Company does not intend to register any portion of the offering in the United States or to conduct a public offering of securities in the United States.

The issue, exercise and/or sale of securities in the offering are subject to specific legal or regulatory restrictions in certain jurisdictions. The Company and Pohjola Corporate Finance Oy assume no responsibility in the event there is a violation by any person of such restrictions.

The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable prospectus published by the Company.

The Company has not authorized any offer to the public of securities in any Member State of the European Economic Area other than Finland. With respect to each Member State of the European Economic Area other than Finland and which has implemented the Prospectus Directive (each, a “Relevant Member State”), no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in any Relevant Member State. As a result, the securities may only be offered in Relevant Member States (a) to legal entity which is a qualified investor as defined in article 2(1)(e) of the Prospectus Directive; or (b) in the United Kingdom to qualified investors who are: (i) investment professionals falling within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) order 2005 (the “Order”), or (ii) persons falling within article 49(2) (“high net worth companies, unincorporated associations, etc”) of the Order (all such persons together being referred to as “relevant persons”). Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents. For the purposes of this paragraph, the expression an “offer of securities to the public” means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to exercise, purchase or subscribe the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

Tulikivi Corporation has supplemented its Finnish language prospectus dated 9 October 2013. The Finnish Financial Supervisory Authority has on 11 October 2013 approved the supplement to the prospectus which is attached hereto in full (in Finnish).
In Juuka, October 11, 2013

TULIKIVI CORPORATION
BOARD OF DIRECTORS

Additional information: Tulikivi Corporation, 83900 Juuka,  www.tulikivi.com
-Chairman of the Board of Directors Harri Suutari, tel. +358 (0) 400 384 937

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NASDAQ OMX Helsinki
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www.tulikivi.com

APPENDIX: TÄYDENNYS TULIKIVI OYJ:N 9.10.2013 PÄIVÄTTYYN ESITTEESEEN 11.10.2013

DISCLAIMER
The information contained herein is not for publication or distribution, directly or indirectly, in or into the United States, Canada, Australia, Hong Kong, South Africa, Singapore or Japan or any other jurisdiction in which the distribution or release would be unlawful. These written materials do not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. The Company does not intend to register any portion of the offering in the United States or to conduct a public offering of securities in the United States.

The issue, exercise and/or sale of securities in the offering are subject to specific legal or regulatory restrictions in certain jurisdictions. The Company and Pohjola Corporate Finance Oy assume no responsibility in the event there is a violation by any person of such restrictions.

The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable prospectus published by the Company.

The Company has not authorized any offer to the public of securities in any Member State of the European Economic Area other than Finland. With respect to each Member State of the European Economic Area other than Finland and which has implemented the Prospectus Directive (each, a “Relevant Member State”), no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in any Relevant Member State.

As a result, the securities may only be offered in Relevant Member States (a) to legal entity which is a qualified investor as defined in article 2(1)(e) of the Prospectus Directive; or (b) in the United Kingdom to qualified investors who are: (i) investment professionals falling within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) order 2005 (the “Order”), or (ii) persons falling within article 49(2) (“high net worth companies, unincorporated associations, etc”) of the Order (all such persons together being referred to as “relevant persons”). Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents. For the purposes of this paragraph, the expression an “offer of securities to the public” means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to exercise, purchase or subscribe the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

Tulikivi Corporation’s Prospectus dated 9 October 2013 describes that the district prosecutor from the Prosecutor’s Office of Varsinais-Suomi pressed charges against Heikki Vauhkonen, CEO of Tulikivi Corporation, and Jouko Toivanen, CFO of Tulikivi Corporation, due to alleged breach of the information obligation in Taivassalo, Finland on 15 – 30 June 2011 pursuant to the Act on Co-operation Within Undertakings.

The District Court of Varsinais-Suomi sentenced on 11 October 2013 Mr. Heikki Vauhkonen, and Mr. Jouko Toivanen to pay 15 day-fines each (Mr. Vauhkonen EUR 1.470 and Mr. Toivanen EUR 1.125) due to the breach of co-operation information obligation in connection with the business transfer of Tulikivi Corporation’s building stone business executed on 1 July 2011 in Taivassalo, Finland. The District Court reasoned its decision by stating that the information required in the Paragraph 41.1 of the Act on Co-Operation Within Undertakings was not disclosed to the employee representatives of Tulikivi Corporation in due time before the execution of the business transfer.

Mr. Vauhkonen and Mr. Toivanen had denied the indictment for breaching the co-operation information obligation considering that they had duly followed the applicable procedure. Tulikivi Corporation was only heard in connection with the process and no legal consequences were claimed or imposed to it.

The decision of the District Court is not legally final. Both Mr. Vauhkonen and Mr. Toivanen consider the decision as erroneous and intent to appeal against the decision to the Appeals Court within the set time.

In Juuka, October 11, 2013

TULIKIVI CORPORATION

Additional information: Tulikivi Corporation, 83900 Juuka,  www.tulikivi.com
–    Harri Suutari,  tel. +358 400 384 937

Distribution

NASDAQ OMX Helsinki
Key media