Interim Report January-September 2020

Oriola Corporation published its Interim report 1 January-30 September 2020 on Friday, 23 October 2020 at 8.30 a.m.

President and CEO Robert Andersson on the third quarter of 2020:

“During the review period, Oriola’s business continued to be significantly impacted by COVID-19 pandemic. The number of infections increased rapidly towards the end of the reporting period. The usage of pharmaceuticals was lower than usual as healthcare resources were allocated to testing and other pandemic preparedness measures. Especially the volumes of elective care fell below the customary level. Moreover, the changes in buying behaviour - based on the restricted consumer mobility - negatively affected the demand for health and wellbeing products. These phenomena impacted the operating environment globally and increased uncertainty also in both Oriola’s markets, Finland and Sweden.

Important milestones were reached in the distribution centre in Sweden. Despite delays caused by the pandemic, the ramp-up phase of the automatisation will be completed during the last quarter of 2020 and the focus will shift to process optimisation and efficiency improvements. The positive impacts of the automatisation and the efficiency improvements will contribute to our financial result gradually.

Oriola’s invoicing remained at the level of the comparison period and net sales increased slightly. On a constant currency basis, invoicing decreased and net sales remained stable. Adjusted EBIT decreased by 30.1% to EUR 6.3 million.

In Consumer, net sales1 grew by 1.2% compared to the same period last year. In the strategically important online channel, growth continued at a rate faster than market. In addition, we saw healthy demand for COVID-19-related services, such as antibody tests, offered by our pharmacies. However, sales of our brick-and mortar pharmacies decreased due to the lower consumer mobility, particularly in shopping centres.

In Pharma, invoicing1 decreased by 3.1% and net sales1 decreased by 0.5% compared to the same period last year. Pandemic slowed down pharmaceutical sales, which was further reflected in the lower demand for pharmaceuticals distribution. The business of Expert services developed favourably during the review period. The decline in pharmaceutical volumes, changes in distribution agreements and the increased cost to serve burdened Pharma’s financial result.

In Retail, net sales1 grew by 1.9% compared to the same period last year. Dose dispensing business developed favourably. Moreover, the demand for products related to pandemic, such as face masks, was active. Retail’s financial result developed positively, mainly due to the growth in dose dispensing and the improved efficiencies in dose dispensing operations. In Sweden, increased cost to serve burdened the business area’s result.

While the market environment has remained tough, we have been capable of safeguarding the health and safety of our employees and executing our societally crucial purpose – Health for life. A warm thank you to our personnel for making this happen.“

1 On a constant currency basis

Q3 2020