Segments (EURm) Q1/21 Q1/20 yoy
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Supermarkets 133.9 118.3 13.2%
Department stores 18.4 21.1 -13.1%
Cars 36.2 33.1 9.5%
Footwear 1.0 1.6 -38.5%
Real Estate 1.2 1.3 -7.7%
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Total sales 190.8 175.5 8.7%
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Supermarkets 1.5 3.4 -56.4%
Department stores -1.7 -1.0 75.1%
Cars 1.2 0.3 344.1%
Footwear -0.6 -0.9 -34.5%
Real Estate 2.5 2.7 -5.7%
IFRS 16 -0.7 -0.3 125.8%
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Total profit before tax 2.2 4.1 -47.1%
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In the first quarter of 2021, the consolidated unaudited sales revenue of
Tallinna Kaubamaja Grupp was 190.8 million euros. Compared to the first quarter
of 2020, when comparable sales revenue was 175.5 million euros, the increase was
8.7%. The net loss for the reporting period was 2.2 million euros, which
increased by 0.4 million euros compared to the first quarter of 2020. The pre-
tax profit was 2.2 million euros, which was 1.9 million euros less than a year
earlier.
Similarly to the previous year, the first quarter of 2021 ended with the closing
of the points of sale of the footwear trade segment, the industrial goods
departments of the Kaubamaja department store segment, and I.L.U. stores. This
year, the closure took place earlier - on 11 March. Last year, industrial goods
departments were closed on 27 March, so this year gave a correspondingly
stronger blow to the seasonal sales of fashion goods. This time, the Group's e-
shops were better prepared for the sharp increase in the volume of orders,
although the growth in e-shop sales did not compensate for the decrease in sales
revenue due to store closures. The Group's car trade segment was the least
affected by the closures - the security of supply of the car brands sold by the
Group made it possible to achieve good sales and profit numbers. The profit in
the supermarket segment was most affected by the one-time expenses for the
integration of the store chain acquired last year into Selver's supply chain and
IT systems. The transfer was accompanied by a few days of store closures to
change the equipment. The largest one-off costs were labour costs for the
training of staff in the transferred stores. From March, the security services
business acquired from P. DUSSMANN EESTI OÜ at the end of 2020 was integrated
into the composition of the security company Viking Security AS, which is
reported in the Group's Kaubamaja department store segment. Labour costs in the
Group increased by a total of 14.3% in the first quarter. The number of
employees increased by 15.7%, i.e. by almost 700 people. The increase in assets
due to previous investments and the revaluation of material assets was
accompanied by an increase in depreciation of 1.9 million euros. The increase in
depreciation due to the standard of lease agreements accounted for almost half
of this, mainly due to the stores added to the Selver segment last year. The
total estimated negative impact of IFRS 16 on profit was 0.4 million euros.
In the first quarter of 2021, one of the most important major developments of
the Group in recent years was completed - the new production building of the
central kitchen of Kulinaaria OÜ, the renovation of the previous factory
building, and the interconnection were completed. The most labour-intensive
innovation was the transfer of stores operating under the Comarket brand to the
Selver ABC brand and the integration of Comarket, Delice stores, and the Solaris
Food Store with the Selver supply chain and IT systems. The upgrade of the e-
shop software platform was started in the reporting quarter. This year, Selver
plans to renovate or expand five stores and continue to develop and expand the
service area of the e-shop service to be nationwide.
Selver supermarkets
The consolidated sales revenue of the supermarket business segment in the first
quarter of 2021 was 133.9 million euros, increasing by 13.2% compared to the
previous year. The average monthly sales revenue per square metre of sales area
in the first quarter of 2021 was 0.38 thousand euros, decreasing by 3.1%
compared to the previous year. In terms of comparable stores, the sales revenue
of goods per square metre of sales area was 0.39 thousand euros, remaining at
the level of the previous year. In the first quarter of 2021, 9.5 million
purchases were made from Selver stores, which is 2.8% more than in the
comparable period a year earlier.
The consolidated pre-tax profit of the supermarket segment in the first quarter
of 2021 was 1.5 million euros, which is 1.9 million euros less than in the
previous year. The consolidated loss of the supermarket segment was 0.1 million
euros, which is 1.3 million euros weaker than last year. The difference between
the loss and profit before income tax is partly due to the income tax paid on
dividends - in 2021; the income tax on dividends was 0.6 million euros lower
than a year earlier.
From 1 June 2020, the results of the supermarket segment include the results of
ABC Supermarkets.
Selver's comparison base for the first quarter is affected by the acquisition of
the ABC Supermarkets store chain last year, which increased the number of Selver
stores by 19. In February 2021, the sales activities of one store were
terminated and at the end of the quarter, the sales activities will continue in
the eighteen added stores. In addition, the comparability of the results is
affected by the new Selver store opened in July 2020 and the renovation of one
Selver store in the first quarter of the previous year, as well as the fact that
last year was a leap year. Compared to the previous year, the sales volume of
Selver's e-channel has tripled. The service area of e-Selver has been
significantly expanded. By the end of the first quarter, e-Selver was
represented in 13 counties, meaning that the e-Selver service is available to
more than one million Estonians. E-Selver is the food and consumer goods chain
with the largest service area in Estonia.
In the first quarter of this year, the transfer of the stores of the ABC
Supermarkets chain operating under the Comarket brand to the Selver ABC brand
was completed and IT software upgrades were made in the Delice store and Solaris
Food Store. In Delice stores and Solaris, the Delice Express service is now
offered to customers - previously, these stores had self-service checkouts, but
now customers can in addition conveniently make purchases with a scanner. This
process involved a few days of store closures to change the equipment as well as
one-off costs and investments.
The development of profit has been affected by the faster growth of labour
costs, which is temporarily caused by the integration of ABC Supermarket store
processes into the Selver solution, higher labour needs in the e-commerce
segment, where the provision of the service is more resource-intensive compared
to the physical store, and higher expenses to cover the increased sick leaves of
employees.
Like the Estonian economy as a whole, the Supermarket segment is affected by
changes in customers' purchasing behaviour and consumption habits related to the
coronavirus that began last year, as well as continued increases in the cost of
personal protective equipment for customers and employees.
Department stores
The sales revenue of the Kaubamaja department stores segment in the first 3
months of 2021 was 18.4 million euros, which was 13.1% less than in the same
period of the previous year. The sales revenue of Kaubamaja department stores
per square metre of sales area was 0.22 thousand euros per month in the first 3
months, which is 15.6% lower than in the same period last year. The pre-tax loss
of Kaubamaja department stores in the first quarter of 2021 was 1.7 million
euros, which was 0.7 million euros weaker than a year ago. The sales result of
Kaubamaja department stores in the first quarter was affected by the sharp
increase in coronavirus indicators in January, which is why the number of
visitors in both Tallinn and Tartu Kaubamaja department stores decreased.
Despite the modest sales of fashion goods, the sales of household goods showed
success at the beginning of the year, and the Kodu Aeg (Time for Home) campaign
at the beginning of February achieved the best results in recent years. Although
the Ilu Aeg (Time for Beauty) campaign at the beginning of March also had a good
start and gave hope for record results as well, the strict restrictions imposed
by the Government of the Republic of Estonia on 11 March, which meant the
closure of all industrial goods stores, had a profound negative effect on the
campaign and all of March. As in the previous year, Kaubamaja department stores
closed all departments of industrial goods in Tallinn and Tartu on 11 March (in
2020, they were closed on 27 March) and only food departments remained open. The
Kaubamaja e-shop has grown strongly throughout the crisis period and has
increased its results sixfold in terms of both turnover and number of visitors.
The turnover of the Kaubamaja e-shop increased by 158% in the first quarter of
2021.
In the first quarter of 2021, the sales revenue of OÜ TKM Beauty Eesti, which
operates the I.L.U. cosmetics stores, was 1.0 million euros, which was 9.7% less
than in the same period in 2020. In the first quarter, the loss was 0.06 million
euros, which increased by 12.6% compared to the comparable period of 2020. The
result of the first quarter was negatively affected by consumers' caution when
going to shopping centres due to the COVID-19 virus situation and the closure of
stores in March. In the reporting quarter, the main focus in marketing and
development activities was on supporting the e-shop, the results of which were
strong as expected.
Car trade
The sales revenue of the car trade segment in the first quarter of 2021 was
36.2 million euros. Sales revenue increased by 9.5% compared to the previous
year. In the first three months of the year, a total of 2,077 new vehicles were
sold. In the first quarter of 2021, the Baltic car market decreased by 17%. In
March, however, there was a light recovery in the market. The pre-tax profit of
the segment for the first quarter of 2021 was 1.2 million euros, exceeding the
profit for the comparable period of the previous year by 0.9 million euros. The
strong result for the first quarter of 2021 can be attributed to the fact that
there were no major delivery difficulties among the brands sold by the car trade
segment of the Group. Profits were helped by the situation where new car
inventories were not too high compared to market demand and there was no reason
for additional discount campaigns.
Footwear trade
The sales revenue of the footwear trade segment was 1.0 million euros in the
first quarter of 2021, decreasing by 38.5% compared to the previous year. The
loss for the first quarter was 0.6 million euros, which is 0.3 million euros
better result than in the same period last year. Sales revenue in the first
quarter was affected by a significant decrease in the number of store visitors
due to declining consumer demand and government's recommendations to restrict
movement in the conditions of the spread of COVID-19. In March, at the beginning
of the spring season, all stores were closed. Only the newly opened e-shops
remained operational, the results of which were as expected.
Real estate
The sales revenue earned in the real estate segment outside the Group in the
first quarter of 2021 was 1.2 million euros. Sales revenue decreased by 7.7%
compared to the previous year. The pre-tax profit of the real estate segment in
the first quarter of 2021 was 2.5 million euros. Compared to the reference
period, profit decreased by 5.7%.
The decline in the segment's sales revenue and profit was again brought about by
the restrictions imposed by the Government of the Republic to prevent the spread
of the coronavirus, which meant the closure of shopping centres as of 11 March.
Pharmacies, grocery stores, optician shops, pet stores, and sales points of
telecommunications enterprises remained open in the centres. Service companies
may continue to operate, ensuring a 25% occupancy requirement. Catering
establishments are only open for selling food for takeaway. The restrictions
have most affected the Tartu Kaubamaja department store, where the number of
visitors to has decreased by almost 30% in the first quarter. The decrease in
the number of visitors to Viimsi Shopping Centre was less than 20%. In addition
to the decrease in sales revenue, the decrease in the segment's profit in the
first quarter was caused by the increase in depreciation due to the revaluation
of assets at the end of last year.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
In thousands of euros
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31.03.2021 31.12.2020
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ASSETS
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Current assets
Cash and cash equivalents 26,072 32,757
Trade and other receivables 15,774 15,894
Inventories 84,992 77,334
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Total current assets 126,838 125,985
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Non-current assets
Long-term receivables and prepayments 323 335
Investments in associates 1,760 1,712
Investment property 60,408 60,347
Property, plant and equipment 388,462 388,757
Intangible assets 20,276 20,148
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Total non-current assets 471,229 471,299
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TOTAL ASSETS 598,067 597,284
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LIABILITIES AND EQUITY
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Current liabilities
Borrowings 51,657 49,402
Trade and other payables 122,936 102,841
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Total current liabilities 174,593 152,243
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Non-current liabilities
Borrowings 222,394 217,349
Deferred tax liabilities 4,408 4,408
Provisions for other liabilities and charges 277 277
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Total non-current liabilities 227,079 222,034
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TOTAL LIABILITIES 401,672 374,277
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Equity
Share capital 16,292 16,292
Statutory reserve capital 2,603 2,603
Revaluation reserve 102,037 102,630
Currency translation differences -149 -149
Retained earnings 75,612 101,631
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TOTAL EQUITY 196,395 223,007
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TOTAL LIABILITIES AND EQUITY 598,067 597,284
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CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
In thousands of euros
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3 months
2021 3 months 2020
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Revenue 190,766 175,496
Other operating income 205 243
Cost of merchandise -145,316 -134,030
Services expenses -11,526 -10,534
Staff costs -20,837 -18,233
Depreciation, amortisation and impairment losses -9,857 -7,991
Other expenses -250 -231
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Operating profit 3,185 4,720
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Finance income 1
Finance costs -1,076 -697
Share of net profit of associates accounted for
using the equity method 48 55
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Profit before tax 2,158 4,078
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Income tax expense -4,333 -5,821
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NET LOSS FOR THE FINANCIAL YEAR -2,175 -1,743
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Other comprehensive income:
Items that will not be subsequently reclassified
to profit or loss
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Other comprehensive income for the financial year 0 0
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TOTAL COMPREHENSIVE LOSS FOR THE FINANCIAL YEAR -2,175 -1,743
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Basic and diluted earnings per share (euros) -0.05 -0.04
Raul Puusepp
Chairman of the Board
Phone +372 731 5000
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