Tikkurila's Interim Report for January-December 2012 - A record year 2012

15 februari 2013 Tikkurila Oyj Stock Exchange Release February 15, 2013 at 9:00 a.m. (CET+1) Full-year 2012 highlights * Revenue increased by 4.4 percent to EUR 671.8 million (2011: EUR 643.7 million). * Operating profit (EBIT) excluding non-recurring items was EUR 73.9 (62.7) million, i.e. 11.0 (9.7) percent of revenue. * Operating profit (EBIT) was EUR 66.6 (61.2) million, i.e. 9.9 (9.5) percent of revenue. * Non-recurring items were EUR -7.4 (-1.5) million. * EPS was EUR 0.92 (0.80). * The Board proposes a dividend of EUR 0.76 (0.73) per share, which corresponds to about 82.6 (90.7) percent of the Group's 2012 earnings per share. * Cash flow after capital expenditure was EUR 50.3 (13.3) million. October-December 2012 highlights * Revenue increased by 2.2 percent to EUR 121.8 million (10-12/2011: EUR 119.1 million). * Operating loss (EBIT) excluding non-recurring items was EUR -3.2 (-2.3) million, i.e. -2.6 (-1.9) percent of revenue. * Operating loss (EBIT) was EUR -4.0 (-3.8) million, i.e. -3.3 (-3.2) percent of revenue. * EPS was EUR -0.10 (-0.11). Revenue and EBIT estimates for 2013 * Tikkurila expects its revenue and EBIT in euro excluding non-recurring items for the financial year 2013 to remain on 2012 level. Key Figures (EUR million) 10-12/2012 10-12/2011 Change % 1-12/2012 1-12/2011 Change % ------------------------------------------------------------------------------- Income statement Revenue 121.8 119.1 2.2% 671.8 643.7 4.4% Operating profit (EBIT), excluding non- -3.2 -2.3 -40.6% 73.9 62.7 17.8% recurring items Operating profit (EBIT) margin, -2.6% -1.9%   11.0% 9.7% excluding non- recurring items, % Operating profit -4.0 -3.8 -5.6% 66.6 61.2 8.7% (EBIT) Operating profit -3.3% -3.2%   9.9% 9.5% (EBIT) margin, % Profit before -4.2 -5.3 20.5% 59.2 50.7 16.9% taxes Net profit -4.6 -5.0 9.5% 40.6 35.5 14.3% Other key indicators EPS*, EUR -0.10 -0.11 9.5% 0.92 0.80 14.3% ROCE, % rolling 21.0% 19.4%   21.0% 19.4% Cash flow after capital 9.8 0.8   50.3 13.3 278.7% expenditure Net interest- bearing debt at   80.6 99.4 -18.9% period-end Gearing, %       39.1% 51.9% Equity ratio, %       47.7% 44.1% Personnel at   3,227 3,551 -9.1% period-end Comments by Erkki Järvinen, President and CEO: "Last year was a record-breaking year for us in many ways. In honor of our company's 150th anniversary, we attained a record-high revenue, operating profit, and cash flow from operations, although the overall macro-economic development did little to support our business operations. The euro region suffered from a debt crisis and drifted into recession as the year progressed. The growth rate of the Russian economy also waned towards the end of the year. Our revenue growth was moderate as sales volumes decreased in all markets in the second half of the year, in particular, as a result of the weak market atmosphere and declining consumer confidence. Our excellent operative profitability was, in particular, based on the cost savings generated by the restructuring and the streamlining of operations we launched a year ago. Our relative profitability increased particularly in the east, where the relative share of our premium brand Tikkurila in sales grew, against the general market trend. In addition, we improved the management of net working capital, which had a positive impact on our cash flow. In addition to the debt crisis in the euro region, the year 2012 was characterized by high raw material prices, although the upward trend started to stabilize over the course of the year, as the outlook for the global economy weakened. Thus, our revenue growth was mainly due to the sales price increases, which we had to carry out in order to compensate for the higher raw material costs. Traditionally, the last quarter of the year is clearly less significant for us than the summer season in terms of both sales and results. We have begun increasing our product inventories for the upcoming exterior painting season. Despite our lighter cost structure, loss in the last quarter remained at the previous year's level due to the sales and marketing investments, which were greater than in the comparison period. Our objectives are organic growth and stronger positions in our most important markets in the increasingly tighter competitive situation. It seems that the macroeconomic situation continues to be challenging. The average economic growth in our key markets is likely to be no more than a couple of percent. In the light of this outlook, we estimate our revenue and operating profit excluding non-recurring items in the 2013 financial year to remain at the same level as last year". Outlook for 2013 Economic development in Europe is expected to be weak in 2013. The overall uncertainty and increasing unemployment are expected to have a negative impact on consumers' willingness to purchase and on the demand for Tikkurila's products. The GDPs in Tikkurila's key markets, in other words Russia, Sweden, Finland, and Poland, are estimated to grow an average of approximately two percent in 2013. Raw material prices are estimated to remain stable or to decrease slightly. Tikkurila expects its revenue and EBIT in euro excluding non-recurring items for the financial year 2013 to remain on 2012 level. Board of Directors' proposal for the distribution of profit Tikkurila Oyj's retained earnings totaled EUR 91.1 million on December 31, 2012. The Board proposes to the Annual General Meeting that a dividend of EUR 0.76 per share will be distributed for the year ended on December 31, 2012, and that the rest be retained in the unrestricted equity. The proposed dividend totals about EUR 33.5 million, which corresponds to approximately 82.6 percent of the Group's net profit for 2012. It is proposed that the record date for the payment of the dividend will be April 15, 2013, and that the dividend will be paid on April 24, 2013. Disclosing procedures of financial reviews Tikkurila Oyj follows the disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority, and discloses relevant information (i.e. information likely to have a material effect on the value of Tikkurila's share price) related to its Financial Statement Release with this Stock Exchange Release. Tikkurila's Financial Statement Release for 2012 is attached to this release and is also available on company's website at www.tikkurilagroup.com. Press Conference Tikkurila will hold a press conference regarding its Financial Statement Release for 2012 for the media and analysts today on February 15, 2013, at 12:00 p.m. (CET+1) in the Akseli Gallén-Kallela Cabinet at the Hotel Kämp, (address Pohjoisesplanadi 29, 00100 Helsinki). The conference will be held in Finnish language. Attendees will be served lunch at the conference premises starting at 11:30 (CET+1). The result will be presented by Erkki Järvinen, President and CEO, and Jukka Havia, CFO. The stock exchange release and presentation materials will be available before the event at www.tikkurilagroup.com/investors. Tikkurila Oyj Erkki Järvinen, President and CEO For further information, please contact: Erkki Järvinen, President and CEO Mobile +358 400 455 913, erkki.jarvinen@tikkurila.com Jukka Havia, CFO Mobile +358 50 355 3757, jukka.havia@tikkurila.com Minna Avellan, Manager, Investor Relations Mobile +358 40 533 7932, minna.avellan@tikkurila.com For 150 years already, Tikkurila has provided consumers and professionals with user-friendly and sustainable solutions for surface protection and decoration. Tikkurila wants to be the leading paint company in the Nordic area as well as in Russia and other selected Eastern European countries. - Tikkurila inspires you to color your life. www.tikkurilagroup.com Tikkurila Interim Report 2012: http://hugin.info/142852/R/1678439/547807.pdf This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and (ii) they are solely responsible for the content, accuracy and originality of the information contained therein. Source: Tikkurila Oyj via Thomson Reuters ONE [HUG#1678439]