Apetit Plc's Financial Statements Release 1 January - 31 December 2019
Significant restructuring completed, profitable growth is sought from core operations - Apetit Group's result unsatisfactory

• Net sales of continuing operations amounted to EUR 105.4 (68.7) million
• Operational EBITDA was EUR 0.8 (1.6) million
• Operational EBIT was EUR -0.4 (0.6) million

• Net sales of continuing operations amounted to EUR 296.9 (259.9) million
• Operational EBITDA was EUR 2.5 (5.6) million
• Operational EBIT was EUR -3.0 (1.6) million

• Consolidated net sales amounted to EUR 105.4 (74.0) million
• Operational EBITDA was EUR 0.7 (1.3) million
• Operational EBIT was EUR -0.3 (-0.2) million

• Consolidated net sales amounted to EUR 312.6 (283.1) million
• Operational EBITDA was EUR 2.5 (4.8) million
• Operational EBIT was EUR -3.8 (-1.0) million

* Discontinued operations: On 10 July 2019, Apetit Plc agreed on the sale of the fresh cut products business to the Swedish company Greenfood AB. The sold business is reported in this Financial Statements Release as a discontinued operation. The transaction was completed on 30 September 2019.

The Board of Directors will propose to the Annual General Meeting that a dividend of EUR 0.45 per share be paid.

The figures for 2019 and 2018 have been audited. The quarterly and six-month figures are unaudited. The figures in brackets are the equivalent figures for the same period in 2018, and the comparison period means the corresponding period in the previous year, unless otherwise stated.

PROFIT GUIDANCE FOR 2020

The full-year operational EBIT is expected to improve year-on-year (EUR -3.0 million in 2019) and to show a profit.

Esa Mäki, CEO:

"In 2019, Apetit successfully implemented the planned restructuring with the aim of improving profitability. However, there were challenges in the year, especially in the Grain Trade and Oilseed Products businesses.

The crop levels of grain normalised during the new harvest season. Thanks to active procurement, our purchasing volumes were the highest they have ever been, and international demand was at a good level at the end of the year. This meant that our net sales increased substantially year-on-year.

The result of the Grain Trade was a major disappointment: difficulties with international suppliers, failures in the planning of purchases and sales during the harvest season and the substantially lower-than-anticipated profitability of operations in Lithuania and Latvia weighed down our profitability, making it very poor. Our key goal in the Grain Trade is to restore our ability to trade successfully regardless of harvest levels.

In Oilseed Products, our challenges were related to the weak market price level of rapeseed meal and raw material purchasing: the area under cultivation of oilseed plants declined significantly in Finland to the lowest level seen in decades. The size of the total domestic harvest was only about 40,000 tonnes. As a consequence, we had to increasingly rely on foreign raw material, which was reflected in a decrease in our refining margin. In the new year, we will promote the cultivation of domestic rapeseed through even closer cooperation with growers and continue our projects aimed at increasing added value.

The development and outlook of the Food Solutions business are positive thanks to the steadily growing trend in frozen foods. Nevertheless, the operational EBIT of Food Solutions was significantly weakened by restructuring costs of approximately EUR 1.5 million. The new production line that gradually went into production starting in August has now become established as a functional part of the normal process, which naturally improves the efficiency of our food production in Säkylä. We will continue to develop the efficiency of operations throughout the value chain of the food business.

In Food Solutions, we are now a food company with a strong focus on frozen products. The fresh cut products business was divested in the autumn and our service sales operations were discontinued earlier in the spring. The frozen foods category is growing around the world, and we are contributing to its growth in Finland. Food trends continue to work in our favour: growing interest in the origin of food, the climate impacts of food and making daily life easier through various ready-to-use and tasty food solutions provide us with the best possible support for the continued development and growth of our business.

The common thread between Apetit's continuing business is strong integration with Finnish primary production and the unique value chain built from it. This puts us in an excellent position to respond to consumer needs and requirements. We are currently in the process of updating the Group's strategy, which will be published in the spring. I am convinced that we will return to profitability in 2020."

KEY FIGURES

EUR million 10-12 10-12 Change 1-12 1-12 Change
2019 2018 2019 2018
Continuing operations            
Net sales 105.4 68.7 53% 296.9 259.9 +14%
Operational EBITDA 0.8 1.6   2.5 5.6  
Operational EBIT -0.4 0.6   -3.0 1.6  
Operating profit -1.1 1.2   -4.8 0.5  
Share of profit of 0.6 0.3   -0.9 -0.7  
associated company
Sucros
Profit for the period -0.3 1.4   -5.4 -0.4  
Earnings per share, -0.05 0.23   -0.87 -0.07  
EUR
Working capital at the       64.0 57.2  
end of the period
Investment       11.5 6.1  
Group            
(incl. operations
discontinued during
the
comparison period,
Fresh cut products,
Seafood)
Net sales 105.4 74.0   312.6 283.1  
Operational EBITDA 0.7 1.3   2.5 4.8  
Operational EBIT -0.3 -0.2   -3.8 -1.0  
Operating profit -1.3 -4.3   -3.4 -6.9  
Profit for the period -0.5 -4.1   -4.4 -7.5  
Earnings per share, -0.08 -0.66   -0.71 -1.21  
EUR
Equity per share, EUR       15.09 16.29  
Return on capital       -4.0% -1.7%  
employed (ROCE), %
Net cash flow from       -5.9 -23.5  
operating activities
Equity ratio       55.0 61.4  
Gearing       35.9 21.5  

Apetit has adopted IFRS 16 Leases effective from 1 January 2019. The simplified approach has been applied in the transition, and the comparison figures for the year preceding the adoption of the standard have not been adjusted. This influences the comparability of operational EBITDA, equity ratio and gearing in particular. The effects are described in more detail in the notes to this Financial Statements Release.

NEWS CONFERENCE AND WEBCAST

A news conference (in Finnish) will be held today on 21 February 2020 at 10:00 a.m. at Apetit's office, Sörnäistenkatu 1 A, Helsinki. A live webcast of the news conference can be followed via apetit.fi/for-investors. The presentation material and a recording of the webcast will be available after the news conference on the company's website.

Apetit Plc

For further information, please contact:

Esa Mäki, CEO, Apetit Plc, tel. +358 10 402 2100

Apetit is a food industry company firmly rooted in Finnish primary production. Our operations are based on a unique value chain: we create well-being with vegetables by offering healthy and tasty food solutions that make daily life easier. We also produce high-quality vegetable oils and rapeseed expellers for feeding stuff, and trade grain on the international markets. Apetit Plc's shares are listed on Nasdaq Helsinki. In 2019, Apetit Group's net sales were EUR 313 million. Read more at apetit.fi.