Oriola Corporation’s Interim report January 1– September 30, 2021
27.10.2021
Oriola Corporation stock exchange release 27 October 2021 at 8.30 a.m.
Oriola Corporation’s Interim report 1 January–30 September 2021
Q3 2021: Profitability improved – turnaround proceeding
July–September 2021 highlights
- Invoicing increased by 6.0% to EUR 970.2 (915.3) million. On a constant currency basis invoicing increased by 4.8% and was EUR 959.5 million.
- Net sales increased by 6.1% to EUR 465.7 (438.9) million. On a constant currency basis net sales increased by 4.8% and were EUR 460.1 million.
- Adjusted EBIT was EUR 10.4 (6.3) million. On a constant currency basis the adjusted EBIT was EUR 10.1 million.
- Profit for the period totalled EUR 6.8 (3.7) million and earnings per share were EUR 0.04 (0.02).
January–September 2021 highlights
- Invoicing increased by 4.3% to EUR 2,897.1 (2,778.3) million. On a constant currency basis invoicing increased by 1.4% and was EUR 2,817.4 million.
- Net sales increased by 3.7% to EUR 1,383.4 (1,334.5) million. On a constant currency basis net sales increased by 0.6% and were EUR 1,342.2 million.
- Adjusted EBIT was EUR 14.7 (13.0) million. On a constant currency basis the adjusted EBIT was EUR 14.0 million.
- Profit for the period totalled EUR 6.0 (7.2) million and earnings per share were EUR 0.03 (0.04).
| Key figures | 2021 | 2020 | Change | 2021 | 2020 | Change | 2020 |
| EUR million | 7-9 | 7-9 | % | 1-9 | 1-9 | % | 1-12 |
| Invoicing | 970.2 | 915.3 | 6.0 | 2,897.1 | 2,778.3 | 4.3 | 3,764.9 |
| Net sales | 465.7 | 438.9 | 6.1 | 1,383.4 | 1,334.5 | 3.7 | 1,800.8 |
| Adjusted EBIT1 | 10.4 | 6.3 | 63.4 | 14.7 | 13.0 | 13.4 | 21.0 |
| EBIT | 9.8 | 6.3 | 56.2 | 12.4 | 13.6 | -8.7 | 20.4 |
| Adjusted EBIT % | 2.2 | 1.4 | 1.1 | 1.0 | 1.2 | ||
| EBIT % | 2.1 | 1.4 | 0.9 | 1.0 | 1.1 | ||
| Profit for the period | 6.8 | 3.7 | 85.3 | 6.0 | 7.2 | -16.1 | 11.3 |
| Earnings per share, EUR | 0.04 | 0.02 | 85.4 | 0.03 | 0.04 | -16.0 | 0.06 |
| Net cash flow from operating activities | -16.2 | 4.3 | -2.2 | 12.6 | 58.3 | ||
| Gearing, % | 64.1 | 102.3 | 75.0 | ||||
| Equity ratio, % | 19.9 | 14.0 | 14.8 | ||||
| Return on capital employed (ROCE), % | 3.7 | 4.5 | 5.0 | ||||
| 1 Adjusting items are specified in note 12. Adjusting items. | |||||||
In order to reflect the underlying business performance and to enhance comparability between financial periods Oriola discloses certain performance measures of historical performance, financial position and cash flows, as permitted in “Alternative performance measures” guidance issued by the European Securities and Markets Authority (ESMA). These measures should not be considered as a substitute for measures of performance in accordance with the IFRS. The calculation methods of these measures are provided in note 11. Alternative performance measures in the notes to this Interim report.
Business outlook for 2021 remains unchanged
The adjusted EBIT on a constant currency basis stays on the same level or increases from the 2020 level.
The COVID-19 pandemic continues during 2021. Severity and duration of the pandemic remain unclear in Oriola’s operating environment. Oriola’s business outlook for 2021 is based on external market forecasts, agreements with pharmaceutical companies and pharmacies, and management assessments.
CEO Elisa Markula on the Q3 2021:
“During the third quarter, the pharmaceutical market continued to recover, which was also reflected in Oriola’s performance. Both invoicing and net sales increased by 4.8% in constant currency as the volume demand for pharmaceuticals picked up close to the pre-pandemic level. Oriola’s adjusted EBIT improved to EUR 10.4 (6.3) million, mainly driven by good performance of Retail. Also, Consumer and Pharma improved their results from the comparison period.
For Consumer, the recovery of customer traffic in pharmacies became fully visible only towards the end of the quarter, and the net sales increased by 3.5% in constant currency. Our online channel grew faster (+33%) than the market (+17%) which supported the increase in net sales. Adjusted EBIT increased to EUR 5.0 (4.3) million.
Pharma’s invoicing increased by 4.4% in constant currency due to the recovering pharmaceuticals market. Adjusted EBIT increased to EUR 4.1 (3.0) million. Positive market and volume development supported the profit increase.
Retail’s net sales increased by 5.1% in constant currency, driven by growth of patient volumes in dose dispensing and increased sales volumes of health and wellbeing products in Sweden. Adjusted EBIT increased to EUR 3.6 (1.5) million, mainly due to the positive development of dose dispensing business.
Despite the increased profit, it is obvious that Oriola’s performance is not on the satisfactory level. Successful turnaround is the key objective of our short-term action plan. To ensure its execution, we have initiated determined measures consisting of four key elements: cost savings, efficient net working capital management, excellent customer relationship management and commercial excellence. We strengthened cost savings activities in August and some results were visible already at the end of the reporting period. In the beginning of October, we announced further measures, which aim to simplify Oriola’s operating model and implement a country-based organisational structure. Due to these planned actions, we also initiated statutory employee negotiations. Our target is to improve operational efficiency as well as reduce costs for increased profitability and cost-competitiveness, and thus create value.
With these measures announced, we have entered the first phase of Oriola’s transformation. According to our short-term action plan, we continue to seek further actions to improve Oriola’s profitability, and also assess possibilities for structural arrangements.
Despite the ongoing pandemic, we have been able to safeguard the health and safety of our employees and ensure production continuity and availability.”
Disclosure procedure
This stock exchange release is a summary of Oriola Corporation’s Interim Report January–September 2021. The complete report is attached to this release in pdf format and is also available on Oriola’s website at https://www.oriola.com/
Analyst and investor meeting
Oriola Corporation will organise a live-webcast meeting for investors, analysts and the press on Wednesday, 27 October 2021 at 10.00 a.m. The event can be followed as a live-webcast accessible through this link: https://oriola.videosync.fi/q3-2021.
Further information:
Elisa Markula
CEO
Tel. +358 10 429 2109
Email: elisa.markula@oriola.com
Antti Elevuori
Interim CFO
Tel. +358 40 560 4148
email: antti.elevuori@oriola.com
Distribution:
Nasdaq Helsinki Ltd
Key media
Released by:
Oriola Corporation
Orionintie 5,
02200 Espoo