INTERIM REPORT JANUARY-SEPTEMBER 2015 PRESIDENT AND CEO MIKKO HELANDER 22 OCTOBER 2015

Transcription

1 INTERIM REPORT JANUARY-SEPTEMBER 215 PRESIDENT AND CEO MIKKO HELANDER 22 OCTOBER 215 1

2 KEY EVENTS IN Q3 Measures taken to strengthen the competitiveness of the grocery trade have progressed as planned and the division s profitability remained at a good level Market share and profitability of the building and home improvement trade continued to strengthen New cars have continued to sell well despite Volkswagen s emissions issue Balance sheet very strong, liquid assets 858 million 2

3 Q3 NET SALES GROWTH +1.2% IN LOCAL CURRENCIES EXCL. ANTTILA m 7, 6, 6,84 6,513 5, 4, 3, 2, 2,34 2,23 1, Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 Reported net sales,, incl. Anttila 3

4 Q3 NET SALES BY DIVISION Car trade -2.6% 17m 8% Home improvement and speciality goods trade +4.5% 857m 39% 1,171m 53% Grocery trade -.6% Comparable change 4

5 OPERATING PROFIT EXCL. NON-RECURRING ITEMS m Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 5

6 STEADY PROFIT PERFORMANCE CONTINUES OPERATING PROFIT EXCL. NON-RECURRING ITEMS m Q1/213 Q2/213 Q3/213 Q4/213 Q1/214 Q2/214 Q3/214 Q4/214 Q1/215 Q2/215 Q3/215 6

7 RETURN ON CAPITAL EMPLOYED INCREASES EXCL. NON-RECURRING ITEMS, ROLLING 12 MO % Q1/213 Q2/213 Q3/213 Q4/213 Q1/214 Q2/214 Q3/214 Q4/214 Q1/215 Q2/215 Q3/215 7

8 CASH FLOW AFTER CAPITAL EXPENDITURE m Q1/213 Q2/213 Q3/213 Q4/ Q1/214 Q2/214 Q3/214 Q4/ Q1/215 Q2/215 Q3/215 8

9 FINANCIAL POSITION Equity ratio, % Liquid assets, m Interest-bearing net liabilities, m Capital expenditure, m Return on capital employed*, % Return on equity*, % * Excl. non-recurring items, rolling 12 mo 9

10 1 GROCERY TRADE

11 NET SALES m 3,5 3,494 3,424 3, 2,5 2, 1,5 1, 1,19 1,171 5 Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 11

12 OPERATING PROFIT EXCL. NON-RECURRING ITEMS m Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 12

13 GROCERY TRADE IN Q3 Measures taken to strengthen the competitiveness of the grocery trade have progressed as planned and the division s profitability remained at a good level. Price level in Finnish grocery trade has fallen by around 1% The K-Group responds to changes in the competitive environment both by renewing store concepts in line with strategy and improving its operational efficiency Effect of the real estate arrangement completed in June on the operating profit excluding non-recurring items was -3.3 million. Sales in Russia were down by 2.5% in euros and up by 42% in roubles Kespro s market share increased and profitability remained at a good level 13

14 HOME IMPROVEMENT AND SPECIALITY GOODS TRADE 14

15 Q3 NET SALES GROWTH +4.5% IN LOCAL CURRENCIES EXCL. ANTTILA m 3, 2,5 2,731 2,514 2, 1,5 1, Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 Reported net sales,, incl. Anttila 15

16 OPERATING PROFIT EXCL. NON-RECURRING ITEMS CONTINUED TO INCREASE IN Q3 m Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 16

17 HOME IMPROVEMENT AND SPECIALITY GOODS TRADE IN Q3 Building and home improvement trade Market share is estimated to have grown in Finland, Norway, the Baltics and Russia Operating profit has improved in ten successive quarters Net sales and profitability strengthened in the agricultural and machinery trade In the leisure trade, Budget Sport s sales increased markedly Asko s sales performance +8% 17

18 18 CAR TRADE

19 NET SALES m Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 19

20 OPERATING PROFIT EXCL. NON-RECURRING ITEMS m Q3/214 Q3/215 Q1-Q3/214 Q1-Q3/215 2

21 CAR TRADE IN Q3 Profitability remained at a good level despite challenging market situation Volkswagen Group s diesel emissions issue Vehicles fitted with EU6 diesel engines and vehicles fitted with petrol engines are not affected In Finland, around 5, cars imported by VV-Auto Group are affected Car repairs in Finland can start as soon as the German Federal Motor Transport Authority (KBA) and Trafi in Finland have approved related technical solutions 21

22 1/13 2/13 3/13 4/13 5/13 6/13 7/13 8/13 9/13 1/13 11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 1/14 11/14 12/14 1/15 2/15 3/15 4/15 5/15 6/15 7/15 8/15 9/15 ORDER BACKLOG AT END OF SEPTEMBER HIGHER THAN THE YEAR BEFORE 7 Backlog of customer orders (pcs) Rolling 12 mo average (pcs)

23 MARKET SITUATION AND FUTURE OUTLOOK 23

24 1/ 7/ 1/1 7/1 1/2 7/2 1/3 7/3 1/4 7/4 1/5 7/5 1/6 7/6 1/7 7/7 1/8 7/8 1/9 7/9 1/1 7/1 1/11 7/11 1/12 7/12 1/13 7/13 1/14 7/14 1/15 7/15 odotukset omasta taloudesta seuraavan 12 kk:n kuluttua CONSUMER CONFIDENCE IN FINLAND Expectations for own finances Expectation, 21st century average Source: Statistics Finland 24

25 1/213 2/213 3/213 4/213 5/213 6/213 7/213 8/213 9/213 1/213 11/213 12/213 1/214 2/214 3/214 4/214 5/214 6/214 7/214 8/214 9/214 1/214 11/214 12/214 1/215 2/215 3/215 4/215 5/215 6/215 7/215 8/215 latest month % (rolling 12 mo) RETAIL TRADE TRENDS IN OPERATING COUNTRIES ROLLING 12 MO 1, 8, 6, 4, 2,, -2, Estonia Lithuania Sweden Norway Latvia Finland Latest month Source: Eurostat, excl. motor vehicles and fuels 25

26 FUTURE OUTLOOK Estimates of the future outlook for Kesko Group's net sales and operating profit excluding non-recurring items are given for the 12 months following the reporting period (1/215-9/216) in comparison with the 12 months preceding the reporting period (1/214-9/215). The general economic situation and the expected trend in consumer demand vary in Kesko s different operating countries. In Finland, owing to the decline of consumers purchasing power, the trading sector s performance is expected to remain weak in all product lines, which may be complicated further by actions taken to balance the public finances. In the Finnish grocery trade, the tough competitive situation is expected to continue. The market performance of the Finnish building and home improvement trade is expected to remain weak. The outlook for the car trade is also uncertain. With respect to foreign countries, the economic situation and consumers purchasing power, as well as the outlook in Russia have weakened further. Instead, in Sweden and Norway and the Baltic countries, the market is expected to grow. Kesko Group's net sales for the next 12 months are expected to be lower than the level of the preceding 12 months. The operating profit excluding non-recurring items for the next 12-month period is expected to equal the operating profit level of the preceding 12 months. 26

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