Oriola Corporation’s Half Year Financial Report 1 January–30 June 2018

Oriola Corporation stock exchange release 18 July 2018 at 8.30 a.m.

Oriola Corporation’s Half Year Financial Report 1 January–30 June 2018

Financial performance April–June 2018, continuing operations

  • Invoicing increased by 6.2% (decreased 3.4%) to EUR 896.7 (844.2) million, on a constant currency basis invoicing increased by 11.1% and was EUR 937.8 million                                                                                                      
  • Net sales increased by 3.1% (decreased 4.8%) to EUR 399.4 (387.5) million, on a constant currency basis net sales increased by 8.2% and was EUR 419.1 million
  • Adjusted EBITDA was EUR 14.9 (19.9) million, at constant currencies the adjusted EBITDA was EUR 15.9 million
  • Adjusted EBIT was EUR 7.9 (13.0) million, at constant currencies the adjusted EBIT was EUR 8.6 million
  • Profit for the period totalled EUR 5.4 (8.3) million and earnings per share was EUR 0.03 (0.05)

Financial performance January–June 2018, continuing operations

  • Invoicing increased by 6.3% (decreased 3.1%) to EUR 1,745.0 (1,641.6) million, on a constant currency basis invoicing increased by 10.6% and was EUR 1,815.0 million                                                                                                        
  • Net sales increased by 4.3% (decreased 5.0%) to EUR 787.5 (754.9) million, on a constant currency basis net sales increased by 8.8% and was EUR 821.4 million
  • Adjusted EBITDA was EUR 28.8 (37.8) million, at constant currencies the adjusted EBITDA was EUR 30.4 million
  • Adjusted EBIT was EUR 14.2 (24.1) million, at constant currencies the adjusted EBIT was EUR 15.2 million
  • Profit for the period totalled EUR 9.0 (15.8) million and earnings per share was EUR 0.05 (0.09)

Business outlook for 2018

Oriola’s guidance is unchanged: Adjusted EBIT of continuing operations on constant currency basis is estimated to increase from the 2017 level.

President and CEO Robert Andersson:

“Overall Oriola Group growth was good in the second quarter of the year. The Group’s invoicing increased by 6.2% (11.1% on constant currency basis) and net sales by 3.1% (8.2% on constant currency basis) but the result was burdened by extra costs mainly in Service Business Area. Logistic operations in Finland were stabilised as planned, with deliveries and product picking accuracy and volume equal to that preceding the ERP system change.

Service Business Area invoicing increased by 7.7% (12.3% on constant currency basis) and net sales by 5.2% (9.7% on constant currency basis), but efficiency is still not satisfactory. This resulted in extra staffing to ensure quality and customer deliveries in Finland. In Sweden, increased volumes and high capacity-utilization also resulted in higher costs. To secure our growth and efficiency in Sweden, we have invested in a new automated distribution center in Enköping. The project is proceeding according to plan and the new distribution center is expected to start deliveries in the fourth quarter of 2018.

Oriola Consumer Business Area in Sweden faces strong competition mainly from online pharmacy services. By the end of the second quarter, online sales had risen to 8% (6%) of total pharmacy sales in Sweden. Our online sales continued to grow faster than the market, supporting overall sales growth which was 5.9% on constant currency basis. Weak exchange rate affected our comparable result negatively, as did the establishment costs of comprehensive wellbeing chain Hehku, with 18 stores and online shop in Finland.

Business Area Healthcare continued its good development in the second quarter, making a breakeven result. Net sales grew by 37.6% compared to corresponding period last year. Oriola dose dispensing services currently cover over 70,000 patients, out of which more than 50,000 patients are in Sweden.

In the second quarter, we invested in the second largest online medical center in Sweden, Doktor.se. Oriola subscribed for shares in Doktor.se giving an ownership of approximately 17% of the total number of shares in Doktor.se. This investment provides us with a great opportunity to become an even stronger player in the fast developing digital healthcare market in Sweden, where consumers expect products and services to be available regardless of time and place. The investment further extends our unique range of services not only to the consumers but for the entire value chain in the healthcare sector.”

Key figures, continuing   operations 2018 2017 Change 2018 2017 Change 2017
EUR million 4-6 4-6 % 1-6 1-6 % 1-12
Invoicing 896.7 844.2 6.2 1,745.0 1,641.6 6.3 3,336.3
Net sales 399.4 387.5 3.1 787.5 754.9 4.3 1,527.7
Adjusted EBITDA 14.9 19.9 -24.9 28.8 37.8 -23.9 67.6
Adjusted EBITDA % 3.7 5.1 3.7 5.0 4.4
Adjusted EBIT 1) 7.9 13.0 -39.1 14.2 24.1 -41.0 39.9
EBIT 7.9 12.7 -37.4 13.5 23.2 -41.8 37.8
Adjusted EBIT % 2.0 3.4 1.8 3.2 2.6
EBIT % 2.0 3.3 1.7 3.1 2.5
Profit for the period 5.4 8.3 -34.8 9.0 15.8 -43.3 25.9
Earnings per share, EUR, continuing   operations 0.03 0.05 -34.8 0.05 0.09 -43.3 0.14
Earnings per share, EUR, discontinued   operations - 0.00 -100.0 - 0.00 -100.0 0.00
Net cash flow from operating activities 2) 18.4 51.3 51.1 36.8 23.7
Gross capital expenditure 26.2 24.8 46.1
Total assets 2) 918.8 917.5 922.4
Net interest-bearing debt 2) 99.5 84.4 110.2
Gearing, % 2) 57.1 43.5 55.7
Net debt / 12-month EBITDA 2) 1.8 1.0 1.7
Equity per share, EUR 2) 0.96 1.07 1.09
Equity ratio, % 2) 19.3 21.7 21.8
Return on equity (ROE), % 2) 9.9 17.1 13.0
Return on capital employed (ROCE), %   2) 8.9 15.2 11.7
Average number of shares, 1000 pcs 3)   181,338 181,389 181,328
Average number of personnel 2,675 2,701 2,686
Number of personnel at the end of the   period 2,758 2,741 2,619
1) Adjustment   items are specified in table "Adjusting items included in EBIT"
2) Includes   discontinued operations
3) Treasury   shares held by the company not included

 

Disclosure procedure

This stock exchange release is a summary of Oriola Corporation’s Half Year Financial Report January­­–June 2018. The complete report is attached to this release in pdf format and is also available on Oriola’s website at www.oriola.com.

Analyst and investor meeting

Oriola Corporation will organize a meeting for investors, analysts and the press on Wednesday, 18 July 2018 at 10.00 a.m. at Hotel Scandic Simonkenttä, meeting room Mansku, Simonkatu 9, 00100 Helsinki, Finland.

Next financial report

Oriola Corporation will publish its interim report for January-September 2018 on 1 November 2018.

Further information:

Robert Andersson, President and CEO
tel. +358 10 429 2109, email: robert.andersson@oriola.com

Helena Kukkonen, CFO
tel. +358 10 429 2112, email: helena.kukkonen@oriola.com

Distribution:

Nasdaq Helsinki Ltd
Key media

Released by:

Oriola Corporation
Orionintie 5, 02200 Espoo
www.oriola.com