STOCKMANN’S ANNUAL GENERAL MEETING, 16 MARCH 2010
Decisions of annual general meeting
16.3.2010 at 18.30
STOCKMANN’S ANNUAL GENERAL MEETING, 16 MARCH 2010
STOCKMANN’S LARGEST INVESTMENTS ARE NEARING COMPLETION
The Annual General Meeting of Stockmann plc, held in Helsinki on 16 March 2010,
adopted the financial statements for the financial year 1 January – 31 December
2009, granted release from liability to the responsible officers and resolved to
pay a dividend of EUR 0.72 per share for 2009. The Board of Directors’ proposals
to the Annual General Meeting were approved without changes.
In his review at Stockmann’s Annual General Meeting in Helsinki on 16 March
2010, CEO Hannu Penttilä stated that the global economic downturn which began in
the latter half of 2008 had left a strong mark on the Stockmann Group’s
operations during 2009. Demand declined in all markets, in addition to which the
values of the key currencies for Stockmann, namely the Russian rouble, the
Swedish krona and the Norwegian krone, fell sharply. After brisk growth, the
markets of the Baltic countries went into free fall.
Stockmann initiated strong counter measures, and thanks to the success of these,
the company survived an extraordinarily challenging year with fairly minor
setbacks. The relative gross margin declined by just 0.2 percentage points to
48.1 per cent, consolidated expenses decreased by EUR 53.7 million from the
previous year, EUR 84.4 million of capital was released and equity ratio
exceeded the target of 40 per cent, reaching 44.1 per cent at the close of the
year. Gearing was at the acceptable level of 72 per cent.
Lindex’s profit-earning capacity exceeded even Stockmann’s own expectations,
noted Penttilä. In extremely difficult market conditions, Lindex managed to
expand its market share in all of its main markets and to generate the highest
operating profit in its history, when calculated in local currencies. In Sweden,
Lindex was chosen as the best fashion chain of 2009 and received an award for
the best store interior concept. Lindex might well have been a factor, thought
Penttilä, in the Stockmann Group’s selection as best company of 2009 in the
‘international expansion’ category in a competition arranged by the Finnish
magazine Suomen Kuvalehti.
During the final quarter of 2009, all of Stockmann’s divisions improved their
operating profit excluding non-recurring items. With the global economy
gradually recovering in 2010, Stockmann expects sales to slowly start growing
and the new store openings to accelerate sales towards the end of the year.
Operating profit is still expected to be up both during the first quarter and
for the full year.
Stockmann has been experiencing the largest investment phase in its history. The
year 2010 is the last of four years during which the Group’s annual capital
expenditure has exceeded EUR 150 million. Once the projects have been completed,
Stockmann will move to a stage, starting in 2011, during which the level of
annual capital expenditure will drop by about EUR 90-100 million. 2011 will be
the first full year of operation for Stockmann’s largest investments, which
means cash flow will improve considerably.
In the enlargement of the Helsinki department store, the most important new
commercial space constructed during the project will be fully operating in
November. The renovation works being carried out on the adjacent Keskuskatu in
Helsinki will also be completed by the autumn, resulting in a pedestrian zone.
The fifth department store in Moscow was opened in March. November will see the
opening of the Nevsky Centre, a shopping centre and department store property in
St Petersburg with a commercial floor space of five hectares. The Nevsky Centre
will house Stockmann’s flagship department store in Russia (becoming the second
largest Stockmann department store in the entire chain), stores belonging to
Stockmann’s own fashion chains and stores of renowned chains from outside the
In the autumn, as part of the Stockmann department stores’ multichannel
strategy, the company will launch the stockmann.com online store alongside Hobby
Hall, which is Finland’s largest distance retailing store and owned by
In 2011, the Stockmann department store in Ekaterinburg, Russia will be opened
following a two-year postponement due to the financial crisis.
Lindex continued its growth last year by opening 34 new stores in existing and
new market areas, the latest of which is Slovakia. Lindex’s expansion plan for
this year includes the opening of about 40 new stores, some by the company
itself and some by franchising partners. Franchising stores will be opened in
Egypt, Dubai and Bosnia and Herzegovina, which are completely new market areas.
In addition to this, Lindex will expand its online store to include Finland. It
already expanded its online store from Sweden into Denmark last year. Seppälä
will also continue its expansion, opening 5-8 new stores this year.
Payment of dividends
The Annual General Meeting resolved that a dividend of EUR 0.72 per share, or
87.8 per cent of earnings per share, be paid for the 2009 financial year. The
dividend will be paid on 7 April 2010 to those shareholders who on the record
date for the dividend payout, 19 March 2010, are entered in the shareholder
register kept by Euroclear Finland Ltd.
Election of the members of the Board of Directors
The Annual General Meeting resolved, in accordance with the proposal of the
Board’s Appointments and Compensation Committee, that eight members be elected
to seats on the Board. In accordance with the Committee’s proposal, the Annual
General Meeting re-elected Christoffer Taxell, LL.M., Managing Director Erkki
Etola, Managing Director Kaj-Gustaf Bergh, Professor Eva Liljeblom, Managing
Director Kari Niemistö, Vice President, Sustainability Carola Teir-Lehtinen and
Henry Wiklund, M.Sc. (Econ.), for a term of office valid until the end of the
next Annual General Meeting. In addition, Managing Director Charlotta
Tallqvist-Cederberg was elected as a new member for the same term.
At its organisational meeting on 16 March 2010, the Board of Directors
re-elected Christoffer Taxell as its Chairman and Erkki Etola as its Vice
Chairman. The Board of Directors elected Christoffer Taxell Chairman of the
Appointments and Compensation Committee and elected Erkki Etola, Charlotta
Tallqvist-Cederberg and Henry Wiklund as the other members of the committee.
Jari Härmälä, Authorised Public Accountant, and Henrik Holmbom, Authorised
Public Accountant, were re-elected as the auditors. KPMG Oy Ab, a firm of
authorised public accountants, will continue as the deputy auditor.
Share option scheme for key personnel
In accordance with the proposal of the Board, the Annual General Meeting
resolved that, in deviation from shareholders’ pre-emptive rights, the key
personnel of Stockmann and its subsidiaries be granted 1 500 000 share options.
The deviation from the shareholders’ pre-emptive rights is proposed because the
share options are part of the incentive and commitment scheme for the Group’s
key personnel and constitutes an important element in maintaining the Company’s
competitive advantage on the international recruitment market. Of these share
options, 500 000 will be classified as share options 2010A, 500 000 as share
options 2010B and 500 000 as share options 2010C. The subscription period for
the share options 2010A will be 1 March 2013 – 31 March 2015, for the share
options 2010B 1 March 2014 – 31 March 2016 and for the share options 2010C 1
March 2015 – 31 March 2017. Each share option entitles its owner to subscribe
for one (1) Stockmann plc Series B share, which means the share options entitle
their owners to subscribe a maximum total of 1 500 000 shares. The subscription
price for the share option 2010A will be the trade volume weighted average
quotation of the company’s Series B shares on the Helsinki stock exchange during
the period 1 February – 28 February 2010 increased by a minimum of 10 per cent,
for the share option 2010B the trade volume weighted average quotation of the
company’s Series B shares on the Helsinki stock exchange during the period 1
February – 28 February 2011 increased by a minimum of 10 per cent, and for the
share option 2010C the trade volume weighted average quotation of the company’s
Series B shares on the Helsinki stock exchange during the period 1 February – 29
February 2012 increased by a minimum of 10 per cent. The share subscription
price of the share optionswill be decreased on each record date for dividend
distribution by the amount of dividend decidedafter the beginning of the
subscription price determination period but before the share subscription. As a
result of the share subscriptions, the company’s share capital may increase by a
maximum of EUR 3 000 000.