Börsiteade

Pealkiri

Unaudited consolidated interim accounts for the third quarter and nine months of 2015

Teade

Segments (EURm)    Q3/15  Q3/14    yoy    9m/15  9m/14   yoy  
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Supermarkets        97.1   92.9   4.5%    279.3  268.9   3.9% 
Department stores   21.3   20.9   1.8%     66.6   64.2   3.7% 
Cars                17.3   15.2   13.6%    45.6   43.8   4.2% 
Footwear             3.2    3.3   -4.6%     8.5   10.2  -16.4%
Real Estate          1.0    0.8   16.7%     2.6    2.5   3.8% 
Total sales        139.8  133.2   4.9%    402.6  389.5   3.3% 
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Supermarkets         3.3    3.1   7.4%      4.1    3.3   23.9%
Department stores    0.6   -0.3  -308.2%    0.5    0.5   -7.3%
Cars                 0.7    0.9   -21.3%    1.3    1.1   17.7%
Footwear            -0.3   -0.4   -34.9%   -1.2   -1.3  -11.3%
Real Estate          2.3    2.3   1.1%      6.7    6.7   -0.2%
Total net profit     6.7    5.6   19.9%    11.4   10.3   10.5%
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The unaudited consolidated sales revenue of Tallinna Kaubamaja Grupp in the 3rd
quarter of 2015 was 139.8 million euros, exceeding the year-on-year sales
revenue by 4.9%. The sales revenue in the first nine months was 402.6 million
euros, an increase of 3.3% compared to the nine-month results in 2014, when the
sales revenue was 389.5 million euros. The unaudited consolidated net profit of
the Group for the 3rd quarter of 2015 was 6.7 million euros, which is 19.9%
more year-on-year. The profit of the Group for 9 months in 2015 was 11.4
million euros, which was better by 10.5% compared to the results of the same
period in the previous year. Pre-tax profit in the first nine months was 15.3
million euros, a growth of 20.7% compared to the results of the previous
period. The net profit was influenced by the dividend payment for which income
tax of 3.9 million euros was paid during 9 months in 2015, whereas a year
before income tax was paid in the amount of 2.4 million euros. 

The sales results in the 3rd quarter can be described by uneven consumption by
months. Finally, long-awaited summer arrived in Estonia in August, attracting
clients to the beach and making buying fashion goods less important. Due to
continued warm weather in September, consumers did not start buying autumn
season goods in the 3rd quarter. The supermarkets segment showed a more stable
and stronger sales growth, which was supported by the opening of a new Selver
store in Viimsi in the middle of the quarter. The car trade segment showed a
strong sales growth because of several fleet orders and the usual sales had
yielded good results as well. The decrease in the sales of footwear trade
segment that has lost its market due to tough competition conditions ceased in
the 3rd quarter. The gross margin of the Group continued to grow little by
little in the 3rd quarter, being a sign of a consistently improving management
of goods. A significant cost group is labour costs, which increased by 8.8% in
the 3rd quarter. These costs increased because of the added number of employees
in the new Selver store. The average salary also grew moderately. Miscellaneous
operating costs had a little faster growth in the 3rd quarter compared to
previous quarters because they included one-time costs related to the opening
of a new store. 

Selver supermarkets

The consolidated sales revenue of the supermarkets business segment in 9 months
of 2015 was 279.3 million euros, a year-on-year growth of 3.9%. The
consolidated sales revenue in the 3rd quarter was 97.1 million euros, having
grown by 4.5% compared to the same period in the previous year. Selver’s
subsidiary Kulinaaria OÜ’s turnover earned outside the Group, which does not
account for a significant portion of the total turnover of the segment, has
increased during 9 months and in the 3rd quarter by 40%. This growth is
supported by the fast-growing demand for catering services. SIA Selver’s sales
revenue remained on the same level as the previous year in the 3rd quarter and
during 9 months. 26.8 million purchases were made in Selver stores in 9 months
of 2015, which exceeded the year-on-year number of purchases by 0.5%. The
consolidated pre-tax profit of the supermarkets segment for 9 months of 2015
was 6.3 million euros, and the net profit was 4.1 million euros, growing
year-on-year by 2.7 million and 0.8 million euros, respectively. The pre-tax
profit earned in Estonia was 8.2 million euros and the net profit was 6.0
million euros. The pre-tax profit and net profit was 3.3 million euros in the
3rd quarter, showing a growth of 0.2 million euros (+7.4%), whereof the profit
earned in Estonia was 3.9 million euros. The difference in the net profit and
pre-tax profit is due to the income tax paid on dividends, i.e. the income tax
paid on dividends was 0.37 million euros in 2014 and 2.22 million euros in
2015. The results of the 3rd quarter of 2015 were influenced by the seventh
hypermarket, Viimsi Selver, which was opened in August. The additional store
increases the competition within the chain in addition to strong competition
outside the Group. Regardless, the number of purchases has increased on the
year-on-year basis. The average shopping basket has grown according to the
results of 9 months as well as the 3rd quarter. Successful marketing campaigns
have increased the growth of turnover in the 3rd quarter of 2015 that have
primarily had an impact on the faster growth of sales of industrial consumer
goods. A greater efficiency in the primary process, i.e. selling of goods, has
mostly influenced the profit earned in Estonia. The inventories have been
managed better, which has resulted in a reduced need for price reduction and
write-off of goods. As regards to operating costs, the previous year’s
cost-efficiency level has been maintained. This has been achieved in a
situation, where the base year costs include the opening costs of one store,
whereas this year’s operating costs include the opening costs of one store as
well as the renovation costs of one store. 

Department stores

The sales revenue of the department stores business segment was 66.6 million
euro in 9 months of 2015, a year-on-year growth of 3.7%. Of this result, the
3rd quarter sales revenue was 21.3 million euros, which was 1.8% higher
compared to the revenue earned in the 3rd quarter of 2014. The pre-tax profit
of department stores earned in 9 months of 2015 was 1.6 million euros, being
lower of the results achieved a year before by 16.7%. The pre-tax profit in the
3rd quarter was 0.6 million euros, which was lower of the profit earned in 2014
by 15.6%. In the 3rd quarter, the sales results of the department stores were
influenced by the summer that arrived finally in August and warmer than usual
September that primarily held back the outerwear sales. The 3rd quarter results
were influenced negatively also by the repairs of Viru bus station in Tallinn,
which lasted for 9 weeks and made it harder for clients to access the
department store in Tallinn. Taking into account the attractive positon of
department stores for tourists in the city centre, the exceptionally low number
of tourists had a negative impact on the sales revenue earned in 9 months. The
sales revenue of OÜ TKM Beauty Eesti that operates I.L.U. cosmetics stores was
1.2 million euros the 3rd quarter of 2015, growing 12.9% year-on-year. The loss
earned in the 3rd quarter was 0.1 million euros, which was lower by 0.01
million euros compared to the loss earned for the same period in 2014. The
sales revenue earned in 9 months of 2015 was 3.4 million euros, showing a
growth of 10.4% compared to the same period in 2014. The loss earned in 9
months of 2015 was 0.3 million euros, which was smaller by 0.03 million euros
compared to the loss earned in the same period in 2014. The renovation works
carried out in September in the largest I.L.U. chain store in Rocca al Mare had
a negative effect on the sales revenue. During the renovation, the assortment
offered for men was optimised and the area of the store was reduced a little.
At the same time, the restructuring works conducted in the store at Ülemiste
centre affected the comparison basis for the 3rd quarter sales revenue
positively. During that time, the Ülemiste I.L.U. store was partly closed in
the previous period. 

Car Trade

The sales revenue of car trade earned in 9 months of 2015 was 45.6 million
euros. The sales revenue exceeded the revenue earned during the same period of
the previous year by 4.2%, including an increase in the sales revenue by 8.3%
of KIA cars. The sales revenue of 17.3 million euros earned in the 3rd quarter
exceeded the year-on-year results by 13.6%, including the sales revenue from
KIA sales by 8.1%. During the first nine months, altogether 2,266 new vehicles
were sold, whereof 861 vehicles in the 3rd quarter. The net profit of the
segment earned in 9 months of 2015 was 1.3 million euros, a result that
exceeded the year-on-year outcome by 17.7%. The pre-tax profit of the segment
in 9 months of 2015 was 1.8 million euros, which exceeded the 9-month-profit
earned in 2014 by 9.8%. The net profit of the 3rd quarter of 2015 was 0.7
million euros, which was lower by 21.3% on the year-on-year basis. In the 3rd
quarter, the sales of new cars grew thanks to several public procurements of
KIA and OPEL. The usual sales of OPEL was fostered by supportive marketing
campaigns provided by the producer and a better pricing of models. The turnover
has been higher also because of better results achieved in the follow-up
servicing. 

Footwear trade

The sales revenue of the footwear trade in first nine months of 2015 was 8.5
million euros, a drop of 16.4% year-on-year. The sales revenue was 3.2 million
euros in the 3rd quarter, showing lower results by 4.6% compared to the same
period in 2014. The loss earned in the first nine months was 1.2 million euros.
The loss was smaller on the year-on-year basis by 11.3%. The footwear segment
had earned a loss of 0.3 million euros by the end of the 3rd quarter, although
the loss was 34.9% smaller than the year-on-year loss. Although the decrease in
sales revenue ceased in the 3rd quarter, the turnover remained smaller than
expected due to an extraordinarily warm August that enabled the consumers to
postpone buying of autumn season goods. The consumers are more driven by need
in their purchasing decisions, and the purchases are made at the last minute
depending on the weather and because the selection of goods is extensive due to
steep competition. The last month in the quarter was successful and allows us
to presume that strategic changes introduced in the Group’s footwear segment
will be fruitful, especially the brand portfolio changes. 

Real estate

The sales revenue of the real estate business earned outside the Group in the
first 9 months of 2015 was 2.6 million euros, which is 3.8% higher than in the
same period of the previous year. The sales revenue earned outside the Group in
the 3rd quarter was 1.0 million euros, which is 16.7% more than in the same
period last year. The pre-tax profit of the real estate segment in 9 months of
2015 was 6.7 million euros, which remained on the same level as the previous
financial year. The pre-tax profit earned in the 3rd quarter was 2.3 million
euros, which is 1.3% more than in the same period of the previous financial
year. On 13 August, Viimsi shopping and recreation centre was opened. The added
rental spaces supported the growth of the sales revenue and profit in the 3rd
quarter. 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

In thousands of euros

                                              30.09.2015  31.12.2014
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ASSETS                                                              
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Current assets                                                      
Cash and cash equivalents                          4,557      24,626
Trade and other receivables                       12,264      17,938
Inventories                                       60,431      56,876
Total current assets                              77,252      99,440
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Non-current assets                                                  
Long-term trade and other receivables                339         338
Investments in associates                          1,911       1,778
Investment property                               12,823       3,035
Property, plant and equipment                    224,681     227,914
Intangible assets                                 10,332      10,402
Total non-current assets                         250,086     243,467
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TOTAL ASSETS                                     327,338     342,907
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LIABILITIES AND EQUITY                                              
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Current liabilities                                                 
Borrowings                                         7,260      20,405
Trade and other payables                          67,545      70,317
Total current liabilities                         74,805      90,722
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Non-current liabilities                                             
Borrowings                                        82,872      77,663
Provisions for other liabilities and charges         690         692
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Total non-current liabilities                     83,562      78,355
TOTAL LIABILITIES                                158,367     169,077
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Equity                                                              
Share capital                                     16,292      16,292
Statutory reserve capital                          2,603       2,603
Revaluation reserve                               66,066      67,159
Currency translation differences                    -255        -255
Retained earnings                                 84,265      88,031
TOTAL EQUITY                                     168,971     173,830
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TOTAL LIABILITIES AND EQUITY                     327,338     342,907
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

In thousands of euros

                                           III         III    9 months  9 months
                                         quarter     quarter    2015      2014  
                                           2015       2014                      
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   Revenue                                 139,759   133,173   402,559   389,533
   Other operating income                      213       156       604       520
                                                                                
   Cost of sales                          -105,414  -100,574  -303,062  -295,841
   Other operating expenses                -12,831   -12,145   -38,777   -37,963
   Staff costs                             -11,768   -10,813   -36,221   -33,894
   Depreciation, amortisation and           -2,919    -2,734    -8,620    -8,126
    impairment losses                                                           
   Other expenses                             -127      -150      -457      -587
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   Operating profit                          6,913     6,913    16,026    13,642
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   Finance income                                1         8        11        19
   Finance costs                              -283      -392      -864    -1,127
   Finance income on shares of                  45        51       133       148
    associates                                                                  
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   Profit before tax                         6,676     6,580    15,306    12,682
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   Income tax expense                            0    -1,014    -3,873    -2,338
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   NET PROFIT FOR THE FINANCIAL YEAR         6,676     5,566    11,433    10,344
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   Other comprehensive income:                                                  
   Items that may be subsequently                                               
    reclassified to  profit or loss                                             
   Currency translation differences              0         0         0         2
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   Other comprehensive income for the            0         0         0         2
    financial year                                                              
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   TOTAL COMPREHENSIVE INCOME FOR THE        6,676     5,566    11,433    10,346
    FINANCIAL YEAR                                                              
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Basic and diluted earnings per share          0.16      0.14      0.28      0.25
 (euros)                                                                        




         Raul Puusepp
         Chairman of the Management Board
         Phone +372 731 5000