Stockmann Group’s Interim Report, 1 January - 31 March 2012

Operating result improved by EUR 14 million from previous year

Helsinki, Finland, 2012-04-27 07:00 CEST (GLOBE NEWSWIRE) -- STOCKMANN plc, Interim Report 27.4.2012 at 8.00 EET

January - March 2012:
Consolidated revenue up 10.4 per cent to EUR 450.3 million (EUR 407.7 million).
Operating result was EUR -16.2 million (EUR -29.9 million).
Result for the period was EUR -20.9 million (EUR -34.8 million).
Earnings per share came to EUR -0.29 (EUR -0.49).

CEO Hannu Penttilä:
The Stockmann Group’s revenue increased in the first quarter of 2012 in all business divisions. The St Petersburg department store boosted the revenue growth in Russia, but I am particularly proud that all our market areas improved their sales despite the uncertain market environment.

There are indications that the market for affordable fashion is improving after the slow performance in 2011. The fashion market in Sweden grew in March after a year of declining sales. Lindex has gained market share both in Sweden and in other markets.

Stockmann’s first quarter operating result is typically negative due to seasonal variation. This year good sales volumes reduced the relative share of costs and increased the operating result by almost EUR 14 million. Lindex performed very well, particularly in March. We were able to improve operating profit in Russia significantly, thanks to increased revenue in the department stores. This provides a solid foundation for achieving a positive full-year operating profit in Russia, excluding Bestseller operations.

The Crazy Days campaign, which took place after the reporting period, in April, again reached a new revenue record with a growth of 13 per cent. This gives us an excellent start for the second quarter and we are well positioned for good performance in the rest of 2012, keeping in mind the volatile market, which may cause disruptions in consumer behaviour. Stockmann’s full-year operating profit is expected to be above the figure for 2011, provided that the market sentiment does not significantly worsen.

Outlook for the rest of 2012
The unstable state of the world economy and the unresolved European debt crisis create a challenging basis for assessing the future outlook, especially the long-term retail market development. The market
sentiment is currently more positive than earlier this year.

The Russian market is likely to continue to perform better than the Nordic countries, provided that the price of oil does not drop significantly from its current level. The growth of consumer markets in the Baltic countries is expected to continue. However, high uncertainty and low consumer confidence may continue to affect consumers’ willingness to purchase in all markets.

The market for affordable fashion developed poorly in 2011, particularly in Sweden. There are indications that the market will improve in 2012.

Stockmann’s decision to discontinue the loss-making Bestseller franchising operation during 2012 will have a minor impact on revenue in Russia, but will improve operating profit from 2013 onwards. Stockmann’s target is to achieve a positive operating profit, excluding Bestseller operations, in Russia in 2012.

During 2012, Stockmann will concentrate on gaining the full benefit of its recently completed capital expenditure projects as well as on the efficient use of capital. Additionally, attention will be given to improving cost efficiency in all units. The Group’s capital expenditure is estimated to be clearly lower than depreciation, and to amount to approximately EUR 50 million in 2012.

Stockmann expects the Group’s revenue and operating profit to be above the figures for 2011, provided that the market sentiment does not significantly worsen.

Key figures

  1-3/2012 1-3/2011 1-12/2011
Revenue, EUR mill. 450.3 407.7 2 005.3
Revenue growth, % 10.4 9.4 10.1
Relative gross margin, % 48.0 47.4 48.7
Operating profit, EUR mill. -16.2 -29.9 70.1
Net financial costs, EUR mill. 8.7 8.3 34.4
Profit before tax, EUR mill. -24.9 -38.3 35.7
Profit for the period, EUR mill. -20.9 -34.8 30.8
Earnings per share, undiluted, EUR -0.29 -0.49 0.43
Equity per share, EUR 11.30 11.13 12.11
Cash flow from operating activities, EUR mill. -73.3 -145.4 66.2
Capital expenditure, EUR mill. 10.3 23.8 66.0
Net gearing, % 112.5 119.7 95.3
Equity ratio, % 38.5 36.8 42.2
Number of shares, undiluted, weighted average, 1 000 pc 71 841 71 146     71 496
Return on capital employed,
rolling 12 months
4.8 4.3 4.1
Personnel, average 15 057 15 552 15 964

This company announcement is a summary of Stockmann’s Interim Report Q1/2012 and includes the most relevant information of the report. The complete report is attached to this release as a pdf file and is also available on the company's website at

Press and analyst briefing and conference call
A press and analyst briefing in Finnish will be held today, on 27 April 2012 at 9.15 a.m. at the F8 Tema restaurant on the 8th floor of Stockmann's Helsinki city centre department store, Aleksanterinkatu 52.

A conference call in English will be held today, on 27 April 2012 at 11.15 a.m. EET. To participate the conference call, please dial +358 9 8864 8511 and, when requested, key in the meeting room number *657899* including the asterisks. The presentation material will be available for downloading on the company's website from 9.15 a.m. EET onwards.

Further information:
Hannu Penttilä, CEO, tel. +358 9 121 5801
Pekka Vähähyyppä, CFO, tel. +358 9 121 3351


Hannu Penttilä


Principal media

Q1 2012 ENG.pdf