ORIOLA CORPORATION’S HALF YEAR FINANCIAL REPORT 1 JANUARY – 30 JUNE 2021

Oriola Corporation stock exchange release 20 July 2021 at 8.30 a.m.

Oriola Corporation’s Half Year Financial Report 1 January–30 June 2021

April–June 2021 highlights

• Invoicing increased by 9.7% to EUR 984.5 (897.7) million. On a constant currency basis invoicing increased by 5.9% and was EUR 950.6 million.
• Net sales increased by 7.3% to EUR 467.5 (435.8) million. On a constant currency basis net sales increased by 3.3% and were EUR 450.0 million.
• Adjusted EBIT was EUR 4.1 (-0.3) million. On a constant currency basis the adjusted EBIT was EUR 3.8 million.
• Profit for the period totalled EUR 0.9 (-1.6) million and earnings per share were EUR 0.01 (-0.01).

January–June 2021 highlights

• Invoicing increased by 3.4% to EUR 1,927.0 (1,863.0) million. On a constant currency basis invoicing decreased by 0.3% and was EUR 1,858.0 million.
• Net sales increased by 2.5% to EUR 917.7 (895.6) million. On a constant currency basis net sales decreased by 1.5% and were EUR 882.1 million.
• Adjusted EBIT was EUR 4.4 (6.6) million. On a constant currency basis the adjusted EBIT was EUR 3.9 million.
• Profit for the period totalled EUR -0.7 (3.5) million and earnings per share were EUR -0.00 (0.02).

Key figures	2021	2020	Change	2021	2020	Change	2020
EUR million	4-6	4-6	%	1-6	1-6	%	1-12
Invoicing	984.5	897.7	9.7	1,927.0	1,863.0	3.4	3,764.9
Net sales	467.5	435.8	7.3	917.7	895.6	2.5	1,800.8
Adjusted EBIT1	4.1	-0.3		4.4	6.6	-34.3	21.0
EBIT	3.0	-0.2		2.5	7.2	-65.2	20.4
Adjusted EBIT %	0.9	-0.1		0.5	0.7		1.2
EBIT %	0.7	-0.1		0.3	0.8		1.1
Profit for the period	0.9	-1.6	158.0	-0.7	3.5	-121.0	11.3
Earnings per share, EUR	0.01	-0.01	158.1	-0.00	0.02	-121.0	0.06
Net cash flow from operating activities	28.2	8.8		14.0	8.3		58.3
Gearing, %				53.8	99.8		75.0
Equity ratio, %				18.0	13.3		14.8
Return on capital employed (ROCE), %				1.1	3.6		5.0
1 Adjusting items are specified in note 12. Adjusting items.

In order to reflect the underlying business performance and to enhance comparability between financial periods Oriola discloses certain performance measures of historical performance, financial position and cash flows, as permitted in “Alternative performance measures” guidance issued by the European Securities and Markets Authority (ESMA). These measures should not be considered as a substitute for measures of performance in accordance with the IFRS. The calculation methods of these measures are provided in note 11. Alternative performance measures in the notes to this Half year financial report.

Business outlook for 2021 remains unchanged

The adjusted EBIT on a constant currency basis stays on the same level or increases from the 2020 level.

The COVID-19 pandemic is expected to continue during 2021. Severity and duration of the pandemic remain unclear in Oriola’s operating environment. Oriola’s business outlook for 2021 is based on external market forecasts, agreements with pharmaceutical companies and pharmacies, and management assessments.

President and CEO Juko Hakala on the Q2 2021:

“Oriola’s second quarter was packed with action. While the COVID-19 pandemic developments created still some temporary pressure, the market was recovering. We focused determinedly on our priorities in performance improvements and profitability while maintaining solid service levels in our operations.

The impacts of the pandemic in Oriola’s business started to ease both in Finland and Sweden, especially towards the end of the quarter. Demand for pharmaceuticals started to pick up, but did not yet reach the pre-pandemic levels. Consumer activity in Sweden was also recovering with the exception of traditionally high consumer density areas, like shopping centres, where Oriola’s key pharmacies are located.

Oriola’s invoicing and net sales were up from the very low comparison period. Invoicing increased by 5.9% and net sales by 3.3% in constant currency. Adjusted EBIT increased to EUR 4.1 (-0.3) million.

For Consumer, market demand and customer traffic in pharmacies recovered partially towards the end of the quarter. The net sales increased by 6.9% in constant currency, driven by recovering market and continued growth in in our strategically developing online channel. Adjusted EBIT increased to EUR 2.0 (0.3) million driven mostly by increased demand in physical pharmacies. General cost increase impacted result negatively.

Pharma’s invoicing increased by 5.8% in constant currency with stable net sales, driven by recovering pharmaceuticals market. Adjusted EBIT remained flat at EUR 2.2 (2.1) million. Positive volume development supported profit. Continued operational inefficiencies caused by pharmaceuticals volume volatility and lower performance in expert services impacted profit negatively.

Retail’s net sales increased by 3.1% in constant currency. This was driven by growth of patient volumes in dose dispensing and increased sales volumes, especially for parallel import and e-commerce customer companies in Sweden. Adjusted EBIT increased to EUR 2.0 (-0.3) million, driven mainly by the continued strength in dose dispensing business.

Oriola’s 2021 prioritities are set by Focus21, our short-term initiative that steers the 2021 activities to reach business and performance goals for the year. This initiative is central to Oriola’s leadership and is progressing well. In Q2, it included e.g. continued significant simplification of our project portfolio as well as operational efficiencies, such as closing down a service centre in Ljusdal, Sweden. Additionally, in Q2 it included measures to steer our long term development. For example, Oriola sold part of its shareholding in Doktor.se for approximately SEK 340 million, capturing significant value increase for the ownership. This also improved net cash flow by EUR 32.8 million in the quarter, and increased equity significantly.

People at Oriola are relentlessly at work to achieve results. Our operational performance has consistently improved and customer feedback is positive, especially in Finland. Within the coming quarters, the pace of action will continue to increase with Oriola’s new President & CEO Elisa Markula joining the company on 9 August 2021. I am inspired by our upcoming co-operation with Elisa and together we will steer a seamless handover with consistently strengthening Oriola’s turnaround focus.” 

Disclosure procedure

This stock exchange release is a summary of Oriola Corporation’s Half Year Financial Report January­­–June 2021. The complete report is attached to this release in pdf format and is also available on Oriola’s website at https://www.oriola.com/

Analyst and investor meeting

Oriola Corporation will organise a live-webcast meeting for investors, analysts and the press on Tuesday, 20 July 2021 at 10.00 a.m. The event can be followed as a live-webcast accessible through this link:  https://oriola.videosync.fi/q2-2021. The event will be arranged only as a webcast.

Further information:

Juko Hakala, President and CEO
tel: +358 10 429 2109 email: juko.hakala@oriola.com

Helena Kukkonen, CFO
tel. +358 10 429 2112, email: helena.kukkonen@oriola.com

 

Distribution:
Nasdaq Helsinki Ltd
Key media

Released by:
Oriola Corporation
Orionintie 5,
02200 Espoo
www.oriola.com/