Interim Report January-March 2021

Oriola Corporation published its Interim report 1 January-31 March 2021 on Tuesday, 27 April 2021 at 8.30 a.m.

President and CEO Juko Hakala on the first quarter of 2021:

“The third wave of the COVID-19 pandemic affected societies in Finland and Sweden significantly in the first quarter of 2021. These effects caused adverse market developments and impacted strongly the entire industry. Low people mobility, lack of seasonal influenza epidemic and tightened restrictions impacted consumer buying behaviour in an exceptional way, especially in Sweden. On top of that, the reallocation of healthcare resources kept the pharmaceutical volumes low.

In the first quarter, Oriola’s invoicing and net sales declined by 6.0% in constant currency. Adjusted EBIT decreased to EUR 0.3 (6.9) million. A major driver was pharmaceutical market volume decline, especially in the important prescription (RX) and over-the-counter (OTC) categories in both markets. Channel shift to online in Swedish pharmacy business accelerated. We estimate these impacts to be temporary, with the exception of the channel shift to online.

For Consumer, the first quarter was challenging due to the strong COVID-19-related impacts in consumer behaviour, particularly in January and February. The first quarter net sales decreased by 6.4% in constant currency. The online sales increased by 80%. Adjusted EBIT decreased to EUR -0.6 (5.4) million. Key drivers for this adverse profit impact were lower volumes in RX and OTC pharmaceuticals. The channel shift to online accelerated.

Pharma business area was also impacted by the temporary pandemic effects. The first quarter net sales declined by 6.3% in constant currency. Adjusted EBIT decreased to EUR 2.0 (3.6) million. Key drivers were lower volumes in many RX and OTC categories, like cough and cold, changes in customer agreements as well as volume volatility driven operations inefficiency.

The net sales of Retail decreased by 3.7% in constant currency. Adjusted EBIT increased to EUR 1.1 (0.2) million, mainly due to the positive development of dose-dispensing business. Also, improved customer agreements in health and wellbeing product category in Sweden impacted the result positively.

Due to the significant temporary pandemic effects in the market environment, we started a short-term initiative named Focus21. The initiative simplifies the focus of Oriola’s 2021 activities to reach its strategic and business performance goals for the year. Oriola’s current strategic programmes 20by20 and Customer Experience will be merged into Focus21.

While the beginning of the 2021 was a challenging one for Oriola’s profitability, our operational service level was solid. We performed well in our role of delivering pharmaceuticals and operated our services reliably to our customers and the society amid the pandemic. Going forward in 2021, we continue working in line with our purpose “Health for life”, continuing to prioritise Oriola’s reliable service, profitability and competitiveness.“

Q1 2021