This release is a summary of
January-
- Invoiced sales increased by 19.9% and totalled
EUR 67.0 million (55.9) -
Net sales increased by 20.9% to
EUR 65.6 million (54.3) -
Adjusted EBITDA was
EUR 12.1 million (12.3) -
EBITA was
EUR 7.7 million (8.9) -
Adjusted EBITA was
EUR 9.2 million (9.2) - Adjusted EBITA margin was 14.1% (16.9)
-
Operating profit was
EUR 7.6 million (8.8) -
Adjusted operating profit was
EUR 9.1 million (9.1) -
Items affecting comparability totalled
EUR 1.6 million (0.3) -
Net cash flows from operating activities were
EUR 7.2 million (10.1) - Net debt / Adjusted EBITDA was 1.6x
-
Earnings per share, basic was
EUR 0.29 (0.33) - Equity ratio increased to 34.8% (25.1)
-
Snow toys moulds were sold to
Wiitta Oy - Raw material prices have risen to exceptionally high levels
July-
- Invoiced sales increased by 6.4% and totalled
EUR 22.0 million (20.7) -
Net sales increased by 7.7% to
EUR 21.8 million (20.3) -
Adjusted EBITA was
EUR 3.3 million (4.0) - Adjusted EBITA margin was 15.1% (19.9)
-
Operating profit was
EUR 3.3 million (4.0) -
Net cash flows from operating activities were
EUR 1.8 million (5.6) Orthex was selected as a pioneering company to theFinnish Innovation Fund Sitra's list of the most interesting companies in circular economy inFinland
Long-Term Financial Targets
As long-term financial targets the company has adopted to an average annual organic Net sales growth to exceed 5 per cent at the Group level and to exceed 10 per cent outside the Nordics (growth in local currencies), adjusted EBITA margin (adjusted for items affecting comparability) to exceed 18 per cent over time and net debt to adjusted EBITDA ratio to stay below 2.5x. Leverage may temporarily exceed the target range (for example, in conjunction with acquisitions).
The company aims to distribute a stable and over time increasing dividend with a pay-out of at least 50 per cent of net profit, in total, on a biannual basis.
EUR million | 7-9/2021 | 7-9/2020 | Change | 1-9/2021 | 1-9/2020 | Change | 1-12/2020 |
Invoiced sales | 22.0 | 20.7 | 6.4% | 67.0 | 55.9 | 19.9% | 77.9 |
Net sales | 21.8 | 20.3 | 7.7% | 65.6 | 54.3 | 20.9% | 75.9 |
Gross margin | 5.8 | 6.7 | -14.8% | 18.1 | 17.5 | 3.6% | 24.6 |
Gross margin, % | 26.4% | 33.3% | 27.6% | 32.2% | 32.4% | ||
EBITDA | 4.3 | 5.1 | -16.4% | 10.5 | 12.1 | -12.7% | 16.5 |
EBITDA margin, % | 19.6% | 25.2% | 16.1% | 22.2% | 21.7% | ||
Adjusted EBITDA | 4.3 | 5.1 | -16.4% | 12.1 | 12.3 | -2.0% | 17.1 |
Adjusted EBITDA margin, % | 19.6% | 25.2% | 18.4% | 22.7% | 22.5% | ||
EBITA | 3.3 | 4.0 | -18.5% | 7.7 | 8.9 | -13.6% | 12.3 |
EBITA margin, % | 15.1% | 19.9% | 11.7% | 16.4% | 16.3% | ||
Adjusted EBITA | 3.3 | 4.0 | -18.5% | 9.2 | 9.2 | 0.8% | 12.9 |
Adjusted EBITA margin, % | 15.1% | 19.9% | 14.1% | 16.9% | 17.0% | ||
Operating profit | 3.3 | 4.0 | -19.0% | 7.6 | 8.8 | -14.3% | 12.3 |
Operating profit margin, % | 14.9% | 19.9% | 11.5% | 16.3% | 16.2% | ||
Net cash flows from operating activities | 1.8 | 5.6 | -67.5% | 7.2 | 10.1 | -28.4% | 12.7 |
Net debt / Adjusted EBITDA | 1.6x | n.a. | 1.6x | n.a. | 2.3x | ||
Adjusted return on capital employed (ROCE), % | 9.7% | 13.6% | 28.0% | 29.6% | 40.3% | ||
Equity ratio, % | 34.8% | 25.1% | 34.8% | 25.1% | 22.6% | ||
Earnings per share, basic (EUR) | 0.12 | 0.15 | -16.4% | 0.29 | 0.33 | -11.6% | 0.47 |
FTEs | 319 | 292 | 9.1% | 318 | 279 | 13.9% | 285 |
Demand was weakened in the first half of 2020 due to the beginning of the COVID-19 pandemic but had a strong rebound in the third quarter. This is important to keep in mind when comparing the quarters between the years.
The positive sales development is driven by successful commercial strategy implementation, which includes launch of new products, widened distribution, customer collaboration and new customers.
All
I am happy to see COVID-19 related obstacles gradually being removed. We are now able to visit many of our customers and we have already participated in some physical trade fairs. Lockdowns of stores in our major markets are no longer imposed and the demand for our products is becoming more predictable. We can already see a normalising pattern with little seasonal variation in sales over the last few quarters.
As anticipated, adjusted EBITA margin was lower in the third quarter at 15.1% (19.9), mostly due to high raw material prices. For January-September, the adjusted EBITA margin was 14.1% (16.9). Adjusted EBITA for the third quarter was
Raw material prices started to increase sharply towards the end of 2020 and reached their highest levels during the second quarter of 2021. Since then, raw material prices have remained high. The cost for freights and electric power have risen in general but are not affecting the result notably as they are a fairly small part of the total cost. Our understanding is that raw material availability has been scarce on the market. However, we have been able to source the needed raw material for production. Raw material price fluctuation and measures to off-set the effects are common to the business, and the implementation of our measures started to have an effect towards the end of the third quarter. Unpredictable and fast increases in raw material prices create a short-term profitability challenge due to the delayed effects of implementing price increases or cost savings. Our long-term target is to deliver an adjusted EBITA margin exceeding 18%, and we are committed to ensuring that our measures are in line with that target.
Our strong commitment to sustainability was recognised when
We are committed to implementing our growth strategy with a focus on accelerated international growth and sustainability. We expect that the effect of our first measures to reduce the impact of high raw material prices will soon be fully visible. We will continue our targeted actions depending on the raw material price development. At the moment, raw material prices, freight cost and energy price are on high levels and future development is hard to predict.
Press conference on financial results
Q&A
Questions to the management can be sent through the meeting chat.
Presentation material
The presentation material will be shared in the online meeting and it can be downloaded the same day on
Recording of the event
After the event a recording will be available on the company's website at https://investors.orthexgroup.com/.
Further enquiries
Tel. +358 (0)40 500 3826
alexander.rosenlew@orthexgroup.com
Saara Mäkelä, CFO,
Tel. +358 (0)40 083 8782
saara.makela@orthexgroup.com
https://news.cision.com/orthex-oyj/r/orthex-q3--strong-performance-despite-high-raw-material-prices,c3450916
https://mb.cision.com/Main/20238/3450916/1494115.pdf
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