Published 22.10.2015

Cash flow from operating activities took a positive turn despite low net sales

– The Tulikivi Group’s third-quarter net sales were EUR 8.3 million (Q3/2014: EUR 9.8 million), the operating profit in the third quarter was EUR 0.3 (0.2) million and the result before taxes was EUR 0.0 (0.0) million. The operating result before non-recurring expenses was EUR 0.4 (0.5) million in the third quarter.
– The Group’s net sales in the reporting period 1 January – 30 September 2015 were EUR 23.0 million (1 January – 30 September 2014: EUR 28.6 million), the operating result was EUR -3.0 (-2.2) million and the result before taxes was EUR -3.6 (-2.8) million. The operating result before non-recurring expenses was EUR -2.3 (-1.0) million in the reporting period.
– Net cash flow from operating activities was EUR 1.1 (-1.3) million in the third quarter and EUR 0.1 (-4.8) million in the reporting period.
– Order books at the end of the period amounted to EUR 4.3 (4.2) million.
– Future outlook: Net sales for 2015 are expected to total approximately EUR 32 to 33 million and the operating result in euros to be on the 2014 level.

Summary of the interim report 1-9/2015. The full interim report is attached to this release.

Key financial ratios	1-9/2015	1-9/2014	Change,%	1-12/2014	7-9/2015	7-9/2014	Change,%
Sales, MEUR	23.0	28.6	-19.7	39.3	8.3	9.8	-14.5
Operating profit/loss, MEUR	-3.0	-2.2	-36.3	-2.4	0.3	0.2	22.0
Operating result before non-recurring expenses, MEUR	-2.3	-1.0	-127.9	-1.0	0.4	0.5	-29.3
Profit before tax, MEUR	-3.6	-2.8	-28.7	-3.3	0.0	0.0	-48.0
Total comprehensive income for the period, MEUR	-3.5	-2.3	-53.6	-2.6	0.0	0.0	0.0
Earnings per share, Euro	-0.06	-0.04		-0.04	0.00	-0.01
Net cash flow from operating activities, MEUR	0.1	-4.8		-2.1	1.1	-1.3
Equity ratio, %	35.6	38.6		39.0
Net indebtness ratio,%	114.7	101.1		89.8
Return on investments,%	-10.6	-6.8		-5.4	0.9	0.6

 

Comments by Heikki Vauhkonen, Managing Director

Demand for Tulikivi’s products was low in the third quarter but has picked up as the main season has started in the principal markets.

Thanks to increased cooperation with the home-building industry, deliveries of fireplaces to the new construction market have increased despite the challenging market conditions.

The challenging conditions are being caused by the modest level of low-rise housing construction, low heating energy prices and consumer uncertainty in purchasing decisions.

In Germany and France, the main markets in Central Europe, conditions have improved since last year. The net sales from fireplace exports to Germany and France in the third quarter were at the same level as the previous year. In Russia net sales were lower than in 2014 as a result of difficult economic circumstances in the country. Sales from Tulikivi’s own sales office in Moscow have grown well and reduced the shortfall in Russian net sales from 2104.

In the third quarter the company’s flow of orders was EUR 8.6 (9.6) million. Order flow in Finland was nearly on the previous year’s level but in Russian exports and lining stone products the order flow was lower than that of 2014.

Tulikivi’s order books at the end of the reporting period amounted to EUR 4.3 (4.2) million.

Due to decreased net sales, the company will continue to improve its operating performance by implementing savings of EUR 2.5 million in fixed costs in 2015. Furthermore, the company aims to release working capital by decreasing its inventory levels by EUR 2.5 million.

Thanks to the adjustment measures implemented, the company’s profitability in the third quarter remained on the 2014 level and third-quarter cash flow from operating activities was EUR 1.1 million in the black. The decline in net sales is expected to continue getting smaller and profitability is expected to improve during the remainder of the year thanks to performance improvement measures.

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 1-9/2015