Stockmann Group’s Interim Report 1 January - 31 March 2018

First-quarter adjusted operating result on a par with the previous year

STOCKMANN plc, Stock Exchange Release 27.4.2018 at 8:00 EET

January–March 2018, continuing operations:
- Consolidated revenue was EUR 202.4 million (216.9).
- Gross margin was 55.1% (53.3).
- Adjusted operating result was EUR -24.8 million (-25.1).
- Reported operating result was EUR -26.9 million (-25.1).
- Adjusted earnings per share were EUR -0.42 (-0.39).
- Guidance unchanged:
Stockmann expects the Group’s revenue for 2018 to be on a par with the previous year. Adjusted operating profit is expected to improve in 2018.


Our first-quarter performance was at last year's level, as we had estimated. Our revenue declined, but gross margin improved. Our inventories are on a healthy level, and thus there were considerably smaller markdowns in the first quarter than in 2017. We expect a similar margin development to continue throughout the rest of the year.  

As the affordable fashion market is changing rapidly, Lindex will look more closely at its store network. Loss-making stores will be closed. The total number of stores is estimated to decrease by over 20 stores this year, compared to 2017. This is more than we estimated at the start of the year and reflects the weakened development in the Swedish fashion market.

Real Estate continued to perform well during the quarter thanks to increased rental income in all markets. Investigations related to possible divestments of the Nevsky Centre and the Book House have actively continued. Both properties are now classified as assets held for sale.

In Retail, Stockmann also launched a digital acceleration project at the beginning of 2018, with the aim of increasing e-commerce and reinforcing the omnichannel approach. As part of the digital project, Stockmann has made a digital partnership agreement with OP Bank.

The Crazy Days campaign, which took place at Stockmann stores after the first quarter, went very well. Campaign sales were up by a total of 4%, with clear growth both in Finland and the Baltics. The online store achieved a sales growth of 19%, which demonstrates that Crazy Days now is a truly omnichannel campaign. The successful campaign give us a solid start to the spring sales.


Continuing operations 1-3/
Revenue, EUR mill. 202.4 216.9 1 055.9
Gross margin, % 55.1 53.3 55.8
EBITDA, EUR mill. -12.6 -10.0 67.6
Adjusted EBITDA, EUR mill. -10.6 -10.0 73.2
Operating result (EBIT), EUR mill. -26.9 -25.1 -148.4
Adjusted operating result (EBIT), EUR mill. -24.8 -25.1 12.3
Net financial items, EUR mill.* -8.7 -4.6 -31.1
Result before tax, EUR mill. -35.6 -29.7 -179.5
Result for the period, EUR mill. -30.9 -26.9 -198.1
Earnings per share,
undiluted and diluted, EUR
-0.45 -0.39 -2.82
Personnel, average 7 074 7 211 7 360
Continuing and discontinued operations** 1-3/
Net earnings per share,
undiluted and diluted, EUR
-0.45 -0.43 -2.98
Cash flow from operating activities, EUR mill. -61.9 -78,1 25.9
Capital expenditure, EUR mill. 7.8 7.8 34.7
Equity per share, EUR 11.78 14.46 12.29
Net gearing, % 94.6 79.9 83.8
Equity ratio, % 41.6 46.1 43.0
Number of shares, undiluted and diluted, weighted average, 1 000 pc 72 049 72 049 72 049
Return on capital employed, rolling 12 months, % -8.9 1.4 -9.1

* Includes in 2017 a write-off of EUR 3.8 million related to Stockmann’s investment in Tuko Logistics Cooperative (Q2 2017), EUR 2.0 million related to Seppälä (Q3 2017), EUR 1.5 million related to Hobby Hall (Q4 2017).
** Discontinued operations include Stockmann Delicatessen food operations in Finland (2017).

Items affecting comparability

EUR million 1-3/
Adjusted EBITDA -10.6 -10.0 73.2
Adjustments to EBITDA
Restructuring arrangements -2.0 -9.6
Fair value gains and losses on investment properties 4.0
Adjustments total -2.0 -5.6
EBITDA -12.6 -10.0 67.6
EUR million 1-3/
Adjusted operating result (EBIT) -24.8 -25.1 12.3
Adjustments to EBIT
Lindex goodwill impairment -150.0
Restructuring arrangements -2.0 -14.6
Fair value gains and losses on investment properties 4.0
Adjustments total -2.0 -160.6
Operating result (EBIT) -26.9 -25.1 -148.4

Stockmann uses Alternative Performance Measures according to the guidelines of the European Securities and Market Authority (ESMA) to better reflect the operational business performance and to facilitate comparisons between financial periods. Gross profit is calculated by deducting the costs of goods sold from the revenue, and gross margin is calculated by dividing gross profit by the revenue as a percentage. EBITDA is calculated from the operating result excluding depreciation, amortisation and impairment losses. Adjusted EBITDA and adjusted operating result (EBIT) are measures which exclude non-recurring items and other adjustments affecting comparability from the reported EBITDA and reported operating result (EBIT). See further information in the notes to the Interim Report.


In the Stockmann Group’s largest operating countries, Finland and Sweden, the general economic situations have improved and according to forecasts by the national central banks, the GDP growth is expected to continue in 2018. Consumer confidence is also estimated to continue its positive development.

However, purchasing behaviour is changing due to digitalisation and increasing competition. This is reflected in the outlook for the fashion market, which according to Stockmann’s management estimate is not developing as well as the economy in general.

In the Baltic countries, the outlook for the retail trade is, according to the management estimate, expected to be better than that for the Stockmann Group’s other market areas.

Stockmann will continue improving the Group’s long-term competitiveness and profitability. The efficiency measures launched at Lindex at the end of 2017 and at Stockmann in the beginning of 2018 have mostly been implemented and they will be fully visible in the 2019 operating costs.

Capital expenditure for 2018 is estimated to be approximately EUR 40-45 million, which is less than the estimated depreciation for the year.


Stockmann expects the Group’s revenue for 2018 to be on a par with the previous year. Adjusted operating profit is expected to improve in 2018.

Press and analyst briefing and webcast
A press and analyst briefing will be held today, on 27 april 2018 at 10:00 a.m. EET in the Fazer À la Carte restaurant on the 8th floor of Stockmann’s Helsinki city centre department store, Aleksanterinkatu 52 B. The event can be followed as a webcast by this link or on the address To participate in the webcast, please dial one of the numbers below 5–10 minutes before the webcast begins. The recording and presentation material are available on the company's website after the event.

Finland: +358 (0)9 7479 0360
Sweden: +46 (0)8 5033 6573
United Kingdom: +44 (0)330 336 9104
United States of America: +1 929 477 0630

Confirmation code: 522545

Further information:
Lauri Veijalainen, CEO, tel. +358 9 121 5062
Kai Laitinen, CFO, tel. +358 9 121 5800


Lauri Veijalainen

Nasdaq Helsinki
Principal media

Stockmann s Interim report Q1 2018 ENG.pdf