OLVI PLC                FINANCIAL STATEMENTS BULLETIN 23 FEB 2021 at 9:00 am

Olvi Group's Financial Statements January to December 2020

FINANCIAL PERFORMANCE IN BRIEF

Olvi Group's sales volume, net sales and operating profit for 2020 made all-time highs for the fifth year in a row, in spite of the corona pandemic. The Group's financial standing also remained on a good level. The Board proposes a dividend of 1.10 (1.00) euro per share.

Near-term outlook

Olvi's operating profit for fiscal year 2021 is expected to remain on the previous year's good level.

Compared to the previous year, first-quarter performance will be impacted by strict restrictions arising from the corona pandemic. Total consumption across the markets is expected to decline temporarily. Also, plans are in place for more effort to be put into marketing in order to prepare for the high season.

CONSOLIDATED KEY RATIOS

10 10 Change 1-12/ 2020 1-12/ 2019 Change % / pp
-12/ -12/ % /pp
2020 2019
Sales volume, 170.3 159.3 6.9 765.9 718.3 6.6
Mltr
Net sales, MEUR 93.0 93.6 -0.6 414.9 408.7 1.5
Gross margin, 13.4 14.3 -6.0 81.4 76.7 6.1
MEUR
% of net sales 14.4 15.2 19.6 18.8
Operating 6.9 7.6 -9.1 56.4 52.5 7.5
profit, MEUR
% of net sales 7.4 8.1 13.6 12.8
Net profit for 2.9 6.9 -57.7 40.9 42.2 -3.1
the period,
MEUR
% of net sales 3.1 7.4 9.9 10.3
Earnings per 0.14 0.33 -57.6 1.96 2.02 -3.0
share, EUR
Investments, 6.9 6.9 -0.3 32.0 31.0 3.4
MEUR
Equity per 12.81 12.58 1.8
share, EUR
Equity to total 63.8 66.4 -2.6
assets, %
Gearing, % -15.5 -11.6 3.9

BUSINESS DEVELOPMENT

LASSE AHO, MANAGING DIRECTOR:
Olvi Group's performance was strong in spite of the corona pandemic

Olvi Group's full-year business development continued on a good track. Sales volume increased by 47.6 million litres or 6.6 percent on the previous year. Net sales increased by 1.5 percent. Net sales development was affected by the corona pandemic; the focus of sales was on retail trade, and this increased the share of inexpensive multipacks. Operating profit improved to 56.4 million euro, an increase of 7.5 percent. Good development was made possible by strong market shares in retail trade across Olvi's operating countries.  We responded quickly to the uncertainty caused by the corona pandemic in the second and third quarters and carried out cost-cutting measures. However, long-term innovative product development continued, as well as investments in improving operational efficiency and increasing production capacity. Olvi has good prerequisites for success also in 2021.

In the fourth quarter, sales volume continued on a strong growth track at 6.9 percent, net sales were on a par with the previous year, but operating profit declined by 9.1 percent. Development was impacted by strict restrictions under the second wave of the corona pandemic, which we anticipated in the interim report issued on 29 October 2020. The restrictions concerned opening hours and sales of alcoholic products in the HoReCa sector, and in some of Olvi's operating countries, also retail trade. Substantial additional effort was put into marketing, particularly with regard to new product development and launches. Fourth-quarter net profit was impacted by one-off write-downs in the subsidiaries, particularly on packaging materials, as well as increases in deferred taxes associated with dividend playouts planned for the following year in those subsidiaries where taxes are payable upon the repatriation of earnings.

The corona pandemic has had a substantial impact on business in 2020. Consumer purchasing patterns have changed and varied along the year due to restrictions on movement and other measures taken to contain the spreading of the coronavirus. In the third quarter, the Group's HoReCa sales recovered close to the previous year's level but dropped again substantially towards the end of the year. The impacts on cross-border sales between Estonia and Finland have been similar. All in all, demand was strongly focused on retail trade, where the sales of large package sizes in particular have increased substantially. Strong sales growth in retail trade has enabled good development of Olvi's total sales. Furthermore, export sales have increased, and the Group has been successful in opening new export markets in spite of the corona pandemic. Olvi's production facilities have been able to operate normally during the year. Compliance with guidance from the authorities and the Group's own guidelines has made it possible to protect the operations against the coronavirus.

Business in Finland developed strongly during the entire year. Sales volume increased by 11.5 percent, which outperformed the previous year by more than 25 million litres. Thanks to strong brands and a versatile range of packaging alternatives, Olvi was able to substantially increase its sales to the retail trade sector. The demand for beer increased in particular. Furthermore, restrictions on travel caused a substantial drop in the number of Finns travelling abroad, thus boosting domestic consumer demand. Net sales increased by 6.6 percent and operating profit increased by 23.4 percent, ending up at 23.0 million euro. Factors behind the earnings improvement include better production efficiency enabled by Olvi's larger sales volumes, operating profit improvements at Servaali and Helsinki Distilling Company, as well as rapid and efficient cost-saving measures in Finland. The fourth quarter was also strong, with sales volume increasing by 16.7 percent and operating profit by 68.2 percent. The operating profit improvement was particularly attributable to a new boost in litres sold through retail trade during the second wave of the corona pandemic, as well as customers stocking up before the excise tax hike.

In Estonia, the sales volume and net sales remained on a par with the previous year, even though A. Le Coq lost substantial sales volume particularly in HoReCa and cross-border sales towards Finland due to travel restrictions. However, demand in domestic retail trade increased respectively. Operating profit declined by 7.1 percent, but relative profitability remained on a good level. The fourth quarter in particular was weaker than the previous year, as harbour and on-board sales came to an almost complete halt and corona measures brought restrictions to HoReCa sales again. A. Le Coq's market position in Estonia has remained very strong, as the company is the market leader in most product categories.

In Latvia, the impact of the corona pandemic on total sales has been the greatest among Olvi Group's operating countries, due to sales restrictions imposed on retail trade as well as restaurants. There was also a substantial drop in cross-border sales. However, full-year sales volume remained on the previous year's level thanks to an increase in sales of non-alcoholic products. Net sales declined by 3.9 percent as consumers preferred less expensive packaging alternatives due to restrictions imposed on restaurants. Operating profit declined by 15.4 percent to 3.6 million euro.

In Lithuania, 2020 was a year of strong growth in spite of challenges brought by the corona pandemic. Sales volume increased by 13.8 percent and net sales by 12.6 percent. Volfas Engelman's domestic market position has strengthened particularly in beers. This supports the development of average price. The further development of exports has been successful, showing growth of 47 percent. Operating profit improved by 13.1 percent and exceeded the 4 million euro mark for the first time.

Also in Belarus, business development continued on a good track. The company's sales volume increased for the eleventh year in a row. Sales volume increased by 5.4 percent thanks to domestic retail sales and exports to Russia. However, the local currency began to weaken heavily in the beginning of the year, and devaluation of 35 percent impacted the development of net sales measured in euro. Due to this, net sales in euro declined by 8.2 percent in spite of an increase of 9.3 percent measured in the local currency. Operating profit improved by 6.4 percent, thanks to better profitability through production efficiency as well as temporary cost savings.
The operating profit improvement in local currency was 26 percent. Relative profitability made an all-time high as operating profit increased to 16.4 percent of net sales.

Olvi Group continued its investments in developing future business. Investments for the year totalled 32.0 million euro. The most important investments went into the juicing facility at Iisalmi and new filling lines in Finland and Belarus.

SEASONAL NATURE OF THE OPERATIONS

The Group's business operations are characterised by seasonal variation. The net sales and operating profit from the reported geographical segments do not accumulate evenly but vary according to the time of the year and the characteristics of each season.

SALES DEVELOPMENT
Olvi Group's sales volume in 2020 reached its all-time high at 765.9 (718.3) million litres. This represents an increase of 47.6 million litres or 6.6 percent on the previous year. The Group's sales volume increased in Lithuania, Finland and Belarus. Sales volumes in Estonia and Latvia remained on a par with the previous year. This is also an achievement when considering the impacts of the corona pandemic. The Group's fourth-quarter sales volume increased by 6.9 percent. Latvia was the only country where the sales volume declined in line with a general decline in consumer demand.  

Sales volume, 10 10-12/ 2019 Change % 1-12/ 2020 1-12/ 2019 Change %
million litres -12/
2020
Finland 62.2 53.3 16.7 244.4 219.3 11.5
Estonia 23.5 23.3 1.2 109.4 109.5 -0.1
Latvia 13.9 14.9 -6.9 70.9 70.9 -0.0
Lithuania 27.0 25.3 6.7 122.4 107.6 13.8
Belarus 48.1 47.0 2.3 245.7 233.1 5.4
Eliminations -4.5 -4.6 -27.0 -22.0
Total 170.3 159.3 6.9 765.9 718.3 6.6

The Group's full-year net sales increased by 1.5 percent and amounted to 414.9 (408.7) million euro. Generally speaking, the corona pandemic had a net sales impact through average price. This was due to changes in the focus of sales channels, as well as larger package sizes.

The Group's net sales development was geographically diversified in the fourth quarter. In Finland, net sales increased along with sales volumes. In Latvia, price competition in retail trade became more intensive as HoReCa sales were halted. In Belarus, the weakened exchange rate caused a decline in comparable net sales; measured in the local currency, net sales improved by 7 percent. 

Net sales, 10 10-12/ 2019 Change % 1-12/ 2020 1-12/ 2019 Change %
million euro -12/
2020
Finland 44.9 41.2 9.1 180.3 169.1 6.6
Estonia 15.0 15.2 -0.7 70.8 71.3 -0.6
Latvia 7.1 8.2 -13.2 37.4 38.9 -3.9
Lithuania 12.4 11.6 6.7 55.5 49.3 12.6
Belarus 15.8 19.7 -20.0 83.3 90.8 -8.2
Eliminations -2.3 -2.3 -12.5 -10.6
Total 93.0 93.6 -0.6 414.9 408.7 1.5

EARNINGS DEVELOPMENT

The Group's operating profit for January-December increased by 7.5 percent and amounted to 56.4 (52.5) million euro, or 13.6 (12.8) percent of net sales. Operating profit development was attributable to increased sales volumes as well as cost savings, particularly in the second and third quarters.

The Group's fourth-quarter operating profit amounted to 6.9 (7.6) million euro. Operating profit improved in Finland but declined in the other operating countries.

Operating 10 10 Change % 1-12/ 2020 1-12/ 2019 Change %
profit, million -12/ -12/
euro 2020 2019
Finland 4.2 2.5 68.2 23.0 18.7 23.4
Estonia 1.8 2.5 -28.0 13.3 14.3 -7.1
Latvia 0.2 0.5 -58.6 3.6 4.3 -15.4
Lithuania 0.3 0.6 -53.1 4.2 3.7 13.1
Belarus 0.9 1.9 -54.2 13.6 12.8 6.4
Eliminations -0.4 -0.4 -1.3 -1.2
Total 6.9 7.6 -9.1 56.4 52.5 7.5
 

The Group's net profit for 2020 declined by 3.1 percent and amounted to 40.9 (42.2) million euro. The Group's fourth-quarter net profit was 2.9 (6.9) million euro. Net profit is hampered by exchange rate differences recognised in financial expenses due to the weakened Belarusian exchange rate (2.0 million euro), as well as deferred taxes on the planned dividend payment out of A. Le Coq's earnings for 2020 (2.6 million euro) in addition to dividend taxes paid in 2020.

Earnings per share calculated from the profit belonging to parent company shareholders declined in January-December and stood at 1.96 (2.02) euro. Fourth-quarter earnings per share amounted to 0.14 (0.33) euro.

BALANCE SHEET, FINANCING AND INVESTMENTS

Olvi Group's balance sheet total at the end of December 2020 was 420.4 (397.4) million euro. Equity per share at the end of 2020 stood at 12.81 (12.58) euro. Devaluation of the Belarusian currency has an impact on the consolidated balance sheet. Equity per share for 2020 would have been 13.53 euro without the change in translation differences. The Group's financial standing and liquidity are on a good level. The equity to total assets ratio was 63.8 (66.4) percent, the gearing ratio stood at -15.5 (-11.6) percent and the current ratio was 1.3 (1.3).

Consolidated cash flow from operations declined slightly on the previous year, due to the change in working capital arising from the parent company's reduced use of receivables factoring. The cash flow figure was 65.8 (67.3) million euro. The Group's liquid assets increased by 12.5 million euro.

Olvi Group's capital expenditure on extensions and replacements in 2020 amounted to 32.0 (31.0) million euro. The companies in Finland accounted for 14.0 million euro, the Baltic subsidiaries for 10.0 million euro and Lidskoe Pivo in Belarus for 8.0 million euro of the total. Olvi Group has continued investments in increasing and diversifying its production capacity, as well as the modernisation of production facilities.

PERSONNEL

Olvi Group's average number of personnel in January-December was 1,911 (1,877). The Group's average number of personnel increased by 1.8 percent.

Olvi Group's average number of personnel by country:

10-12/ 2020 10-12/ 2019 Change % 1-12/ 2020 1-12/ 2019 Change %
Finland 370 365 1.4 389 386 0.8
Estonia 313 305 2.6 324 311 4.2
Latvia 184 183 0.5 193 195 -1.0
Lithuania 237 226 4.9 240 230 4.3
Belarus 755 742 1.8 765 755 1.3
Total 1,859 1,821 2.1 1,911 1,877 1.8
 

The method of calculation for the comparison period has been adjusted to comply with the calculation of personnel numbers for 2020. The adjustment did not have any substantial effect.

BOARD OF DIRECTORS AND MANAGEMENT

There have been no changes in Olvi plc's Board of Directors or management during the review period.

OTHER EVENTS IN THE REVIEW PERIOD
Annual General Meeting

Olvi plc's Annual General Meeting of 8 April 2020 adopted the financial statements and granted discharge from liability to the members of the Board of Directors and Managing Director for the accounting period that ended on 31 December 2019. In accordance with the Board's proposal, the General Meeting decided that a dividend of 1.00 (0.90) euro be paid on each A and K share for the accounting period 2019. The dividend was paid in two instalments on 8 May 2020 and 8 September 2020.

All decisions made at the General Meeting can be found in the bulletin released on 8 April 2020.

Changes in corporate structure

There were no substantial changes in Olvi's holdings in subsidiaries in 2020. One minority shareholder was bought out of Helsinki Distilling Company Ltd.
Olvi's holdings in subsidiaries are:

31 December 2020 31 December 2019 Change
AS A. Le Coq, 100.00 100.00 -
Estonia
A/S Cēsu Alus, 99.88 99.88 -
Latvia
AB Volfas Engelman, 99.67 99.66 0.01
Lithuania
OAO Lidskoe Pivo, 96.36 96.36 -
Belarus
Servaali Oy, Finland 80.00 80.00 -
Helsinki Distilling 78.00 67.00 11.00
Company Ltd, Finland
 

Olvi plc holds 50.0 percent of Arctic Silence Oy. The company has not had any operating activities in 2020. In addition to these, Olvi plc's subsidiaries have holdings in other companies. A. Le Coq has a 49.0 percent holding in AS Karme and 20.0 percent holding in Verska Mineraalvee OÜ in Estonia. AB Volfas Engelman has a 100 percent holding in UAB Uniqa. OAO Lidskoe Pivo has a 100 percent holding in Trade House Lidskoe Pivo.

Share-based payments

At the beginning of 2019, Olvi plc initiated a share-based incentive plan for key personnel, the performance period of which is from 1 February 2019 to 31 January 2021. Detailed information on the incentive plan is provided in Table 5, Section 4 of the tables attached to this financial statements bulletin.

Treasury shares

On the date of closing the accounts, 31 December 2020, the total number of Series A shares held by the company as treasury shares was 38,560 and the total acquisition price was 1,802,467.05 euro. Series A shares held by Olvi plc as treasury shares represent 0.19 percent of all shares and 0.04 percent of the aggregate number of votes. The treasury shares represent 0.23 percent of all Series A shares and associated votes. Treasury shares held by the company are ineligible for voting.

BUSINESS RISKS AND THEIR MANAGEMENT

Risk management

Risk management is a part of Olvi Group's everyday management and operations. The objective of risk management is to ensure the realisation of the company's strategy and secure its financial development and the continuity of business. The task of risk management is to operate proactively and create operating conditions in which business risks are managed comprehensively and systematically in all of the Group companies and all levels of the organisation.

Business risks and uncertainties in the near term

The corona pandemic still has an impact on business operations through increased risks and weakened predictability. Olvi has taken precautions for changes in business operations and prolongation of the corona crisis through cost adaptation and by drafting scenarios and contingency plans, among other measures. So far, the availability of raw materials and the health situation among personnel have been good, and no production disruptions have taken place. However, prolongation of the corona pandemic or substantial numbers of personnel falling ill may impact the production process.

Even though the corona pandemic has had an impact on operational business, for example by causing substantial changes in demand across different sales channels, the Group's financial position has remained strong. Liquidity has not been impacted. The situation has not had any substantial effect on credit loss risk either. No increases can be seen in overdue receivables or credit losses even though the corona pandemic has imposed challenges particularly on customers in the restaurant business. If the corona pandemic is prolonged, this might have an impact also on credit losses particularly in the restaurant sector.

The unstable political situation and substantial weakening of the currency exchange rate bring more uncertainty to Belarus. So far, the situation in the country has not affected the company's day-to-day operations. Operations in Belarus involve foreign exchange risks arising from the cash flows of purchases and sales in foreign currency, as well as the investment in the Belarusian subsidiary and the conversion of its income statement and balance sheet items into euro. The Group's other foreign exchange risks can be considered minor. 

Other short-term risks and uncertainties are related to development of the general economic circumstances, changes in the competitive situation, as well as the impacts these may have on the company's operations. In addition to the risks described above, there have been no significant changes in Olvi Group's business risks. A more detailed description of the risks is provided in the Board of Directors' report and the notes to the financial statements, as well as in the Investors/Corporate Governance/Internal Control section of the company's Web site.

EVENTS AFTER THE REVIEW PERIOD

There have been no significant reportable changes after the review period.

BOARD OF DIRECTORS' PROPOSAL FOR THE DISTRIBUTION OF PROFIT

The parent company Olvi plc had 98.2 (89.4) million euro of distributable funds on 31 December 2020, of which profit for the period accounted for 30.8 (37.7) million euro.

Olvi plc's Board of Directors proposes to the Annual General Meeting that distributable funds be used as follows:
1) A dividend of 1.10 (1.00) euro shall be paid for 2020 on each Series K and Series A share, totalling 22.8 (20.7) million euro. The dividend represents 56.0 (49.6) percent of Olvi Group's earnings per share. The dividend will be paid in two instalments. The first instalment of 0.55 euro per share will be paid on 20 April 2021 to shareholders registered in the register of shareholders held by Euroclear Finland Ltd on the record date 6 April 2021. The second instalment of 0.55 euro per share will be paid on 3 September 2021 to shareholders registered in the register of shareholders held by Euroclear Finland Ltd on the record date 27 August 2021.

No dividend shall be paid on treasury shares.

2) 75.4 million euro shall be retained in the parent company's non-restricted equity.

FINANCIAL REPORTS IN 2021

Olvi Group's Annual Report and notice of Annual General Meeting will be published on 10 March 2021. The Annual Report will include the Board of Directors' report and corporate responsibility report, the consolidated and the parent company's financial statements and the auditors' report for the financial year 1 January to 31 December 2020. The Corporate Governance Statement and the Remuneration Report for 2020 will be published as attachments to the Annual Report. The Annual Report and notice to convene the AGM will be available on Olvi plc's Web site.

The following interim reports will be released in 2021:

Interim Report for January-March on 29 April 2021,
Half-Year Report for January-June on 12 August 2021 and
Interim Report for January-September on 2 November 2021.

OLVI PLC
Board of Directors

Further information: Lasse Aho, Managing Director, Olvi plc, phone +358 290 00 1050 or +358 400 203 600

TABLES:
- Statement of comprehensive income, Table 1
- Balance sheet, Table 2
- Changes in shareholders' equity, Table 3
- Cash flow statement, Table 4
- Notes to the financial statements bulletin, Table 5

DISTRIBUTION:
NASDAQ OMX Helsinki Ltd
Key media
www.olvi.fi

OLVI GROUP TABLE 1

STATEMENT OF
COMPREHENSIVE INCOME
EUR 1,000
10-12/ 10-12/ 1-12/ 1-12/
2020 2019 2020 2019

Net sales 93,017 93,579 414,884 408,706
Other operating income 340 166 923 1,417
Operating expenses -79,965 -79,490 -334,400 -333,423

Depreciation and -6,501 -6,677 -24,972 -24,186
impairment
Operating profit 6,891 7,578 56,435 52,514

Financial income 84 377 277 1488
Financial expenses -567 -126 -2,903 -492
Share of profit in 2 13 2 13
associates

Earnings before tax 6,410 7,842 53,811 53,523
Income taxes *) -3,495 -960 -12,895 -11,293
NET PROFIT FOR THE 2,915 6,882 40,916 42,230
PERIOD

Other comprehensive
income items that may
be
subsequently
reclassified to profit
and loss:

Translation -1,250 -2,774 -15,588 2,887
differences related to
foreign
subsidiaries
Change in fair value, 0 369 0 369
other investments
Income taxes related 6 67 263 -130
to these items
TOTAL COMPREHENSIVE 1,671 4,544 25,591 45,356
INCOME FOR THE PERIOD

Distribution of
profit:
- parent company 2,880 6,816 40,559 41,760
shareholders
- non-controlling 35 66 357 470
interests

Distribution of
comprehensive income:
 - parent company 1,677 4,552 25,704 44,814
shareholders
 - non-controlling -6 -8 -113 542
interests

Earnings per share
calculated from the
profit
belonging to parent
company shareholders,
EUR
-   undiluted 0.14 0.33 1.96 2.02
-   diluted 0.14 0.33 1.96 2.02

*) Income taxes calculated from the profit for the review period.

OLVI GROUP TABLE 2

BALANCE SHEET
EUR 1,000 31 December 2020 31 December 2019
ASSETS
Non-current assets
Tangible assets 204,156 208,701
Goodwill 25,172 26,360
Other intangible assets 9,925 10,598
Shares in associates 994 1,016
Other investments 851 836
Loans receivable and other 1,786 967
non-current receivables
Deferred tax receivables 1,086 475
Total non-current assets 243,970 248,953

Current assets
Inventories 42,278 43,056
Accounts receivable and 88,234 70,685
other receivables
Income tax receivable 773 871
Liquid assets 45,096 33,832
Total current assets 176,381 148,444
TOTAL ASSETS 420,351 397,397

SHAREHOLDERS' EQUITY AND
LIABILITIES
Shareholders' equity held by
parent company shareholders
Share capital 20,759 20,759
Other reserves 1,387 1,387
Treasury shares -1,802 -503
Translation differences -58,842 -43,987
Retained earnings 303,465 282,895
264,967 260,551
Share belonging to non 3,165 3,318
-controlling interests
Total shareholders' equity 268,132 263,869

Non-current liabilities
Financial liabilities 2,303 2,337
Other liabilities 4,473 4,777
Deferred tax liabilities 11,107 7,859

Current liabilities
Financial liabilities 1,333 1,325
Accounts payable and other 132,522 117,100
liabilities
Income tax liability 481 130
Total liabilities 152,219 133,528
TOTAL SHAREHOLDERS' EQUITY 420,351 397,397
AND LIABILITIES

OLVI GROUP TABLE 3
CHANGES IN
SHAREHOLDERS'
EQUITY
EUR 1,000 Share Other Treasury Fair Translation Retained Share of Total
capital reserves shares value differences earnings non
reserve reserve -controlling

interests
Shareholders' 20,759 1,092 -503 295 -43,987 282,895 3,318 263,869
equity
1 Jan 2020
Comprehensive
income:
     Net 40,559 357 40,916
profit for the
period
     Other
comprehensive
income items:
          -14,855 -470 -15,325
Translation
differences
Total -14,855 40,559 -113 25,591
comprehensive
income for the
period
Transactions
with
shareholders:
     Payment -20,710 -38 -20,748
of dividends
     -1,299 -1,299
Acquisition of
treasury
shares
     Share 587 587
-based
incentives,
value of work
performed
     138 138
Adjustment to
previous
periods
Total -1,299 -19,985 -38 -21,322
transactions
with
shareholders
Changes in
holdings in
subsidiaries:
     -6 -6
Acquisition of
shares from
non
-controlling
interests
     Change in 2 -2 0
share
belonging to
non
-controlling
interests
Total changes -4 -2 -6
in holdings in
subsidiaries
Shareholders' 20,759 1,092 -1,802 295 -58,842 303,465 3,165 268,132
equity
31 Dec 2020

EUR 1,000 Share Other Treasury Fair Translation Retained Share of Total
capital reserves shares value differences earnings non
reserve reserve -controlling

interests
Shareholders' 20,759 1,092 -956 0 -46,746 259,864 3,165 237,178
equity
1 Jan 2019
Comprehensive
income:
     Net 41,760 470 42,230
profit for the
period
     Other
comprehensive
income items:
          2,759 72  2,831
Translation
differences
          295 295
Change in fair
value, other
investments
Total 295 2,759  41,760 542 45,356
comprehensive
income for the
period
Transactions
with
shareholders:
     Payment -18,640 -137 -18,777
of dividends
     -726 -726
Acquisition of
treasury
shares
     Sales of 1,179 1,179
treasury
shares to
employees     
     Share 539 539
-based
incentives,
value of work
performed
     -667 -667
Adjustment to
previous
periods
Total 453 -18,768 -137 -18,452
transactions
with
shareholders
Changes in
holdings in
subsidiaries:
     -213 -213
Acquisition of
shares from
non
-controlling
interests
     Change in 252 -252 0
share
belonging to
non
-controlling
interests
Total changes 39 -252 -213
in holdings in
subsidiaries
Shareholders' 20,759 1,092 -503 295 -43,987 282,895 3,318 263,869
equity
31 Dec 2019
 

Other reserves include the share premium account, legal reserve and other reserves.

  TABLE 4

OLVI GROUP
CASH FLOW STATEMENT
EUR 1,000
  1-12/ 2020 1-12/ 2019

Net profit for the period 40,916 42,230
Adjustments to profit for the period 41,299 34,859
Change in net working capital -6,744 1,548
Interest paid -588 -288
Interest received 260 258
Dividends received 4 3
Taxes paid -9,351 -11,298
Cash flow from operations (A) 65,796 67,312

Investments in tangible and intangible -31,533 -31,347
assets
Capital gains on disposal of tangible 1,697 1,815
and intangible assets
Acquisition of shares from non -6 -213
-controlling interests
Acquired shares in subsidiaries, 0 -50
associates and joint ventures
Expenditure on other investments -15 0
Dividends received 24 63
Cash flow from investments (B) -29,833 -29,732

Withdrawals of loans 15,497 2,445
Repayments of loans -16,917 -6,522
Acquisition of treasury shares -1,299 -726
Sales of treasury shares to employees 0 1,179
Dividends paid -20,754 -18,787
Increase (-) / decrease (+) in current 26 -1
interest- bearing business receivables
Cash flow from financing (C) -23,447 -22,412

Increase (+)/decrease (-) in liquid 12,516 15,168
assets (A+B+C)

Liquid assets 1 January 33,832 18,520
Effect of exchange rate changes -1,252 144
Liquid assets 31 December 45,096 33,832
 

OLVI GROUP                                                    TABLE 5

NOTES TO THE FINANCIAL STATEMENTS BULLETIN

This financial statements bulletin has been prepared in accordance with IAS 34 Interim Financial Reporting, applying the same accounting policies as for the previous financial statements. The information in the financial statements bulletin is presented in thousands of euros (EUR 1000). For the sake of presentation, individual figures and totals have been rounded to full thousands, which causes rounding differences in additions. The ratios are calculated from exact amounts in euros. This financial statements bulletin is unaudited.
 

1.  SEGMENT
INFORMATION
NET SALES
BY
SEGMENT AND
NET
PROFIT FOR
THE
PERIOD 1
-12/2020
EUR 1,000 Finland Estonia Latvia Lithuania -Belarus Elimi Group
-nations

INCOME
External 178,992 65,029 35,039 52,701 83,123 0 414,884
sales
     177,738 65,029 35,039 52,701 83,123 0 413,630
Beverage
sales
     1,254 0 0 0 0 0 1,254
Equipment
services
Internal 1,321 5,805 2,338 2,799 217 -12,480 0
sales
Total net 180,313 70,834 37,377 55,500 83,340 -12,480 414,884
sales

Total net 31,011 10,536 3,572 3,402 7,583 -15,188 40,916
profit for
the
period
NET SALES
BY
SEGMENT AND
NET
PROFIT FOR
THE
PERIOD 1
-12/2019
EUR 1,000 Finland Estonia Latvia Lithuania -Belarus Elimi Group
-nations

INCOME
External 167,579 67,297 37,014 46,266 90,550 0 408,706
sales
     165,965 67,297 37,014 46,266 90,550 0 407,092
Beverage
sales
     1,614 0 0 0 0 0 1,614
Equipment
services
Internal 1,523 3,990 1,867 3,014 222 -10,616 0
sales
Total net 169,102 71,287 38,881 49,280 90,772 -10,616 408,706
sales

Total net 37,385 10,578 4,057 3,104 10,606 -23,500 42,230
profit for
the
period

2.  RELATED
PARTY
TRANSACTIONS

Employee
benefits to
management
Salaries and
other short
-term
employee
benefits to
the Board of
Directors and
Managing
Director
EUR 1,000  1  1-12/ 2019
-12/
2020
Managing 550 766
Director
Chairman of 74 71
the Board
Other members 172 171
of the Board
Total 796 1,008

3. SHARES AND SHARE CAPITAL
31 December 2020       %

Number of A shares 16,989,976 82.0
Number of K shares 3,732,256 18.0
Total 20,722,232 100.0

Total votes carried by A shares 16,989,976 18.5
Total votes carried by K shares 74,645,120 81.5
Total number of votes 91,635,096 100.0

Votes per Series A share 1
Votes per Series K share 20

The registered share capital on 31 December 2020 totalled 20,759 thousand euro.Olvi plc's shares received a dividend of 1.00 euro per share for 2019 (0.90 euro per share for 2018), totalling 20.7 (18.6) million euro. The dividends were paid in two instalments. The first instalment of 0,50 euro per share was paid on 8 May 2020. The second instalment of 0,50 euro per share was paid on 8 September 2020. The Series K and Series A shares entitle to equal dividend. The Articles of Association include a redemption clause concerning Series K shares.      

4. SHARE-BASED PAYMENTS                                                                        

The aim of Olvi plc's share-based incentive plan is to combine the objectives of the shareholders and the key employees in order to increase the value of the company, to make the key employees committed to the company, and to offer them a competitive reward plan based on earning the company's shares.

In 2019, Olvi plc initiated a new share-based incentive plan for key personnel, the performance period of which is from 1 February 2019 to 31 January 2021. The prerequisite for receiving reward is that a key employee purchases the company's Series A shares up to the maximum number determined by the Board of Directors and that employment or service continues upon reward payment. Rewards will be paid partly in the company's Series A shares and partly in cash in 2021. The cash proportion is intended to cover taxes and tax-related costs arising from the rewards to the key employees. The plan is directed to approximately 60 people.
In accordance with the share-based incentive plan, Olvi plc sold a total of 36,450 treasury shares to the target group members in 2019 for a price of 1,179,330.37 euro. From January to December 2020, costs associated with the plan were recognised for a total of 1,559.8 thousand euro. Olvi Group does not have any other share-based plans or option plans.

5. NUMBER OF SHARES *)  1-12/ 2020  1-12/ 2019

  - average 20,708,331 20,708,204
  - at end of period 20,683,672 20,710,683

6. TRADING OF SERIES A SHARES ON THE HELSINKI STOCK EXCHANGE

 1-12/ 2020  1-12/ 2019
Trading volume of Olvi A shares 1,474,892 1,575,876
Total trading volume, EUR 1,000 60,470 56,680
Traded shares in proportion to
all Series A shares, % 8.7 9.3

Average share price, EUR 41.03 36.01
Price on the closing date, EUR 48.50 41.20
Highest quote, EUR 50.00 42.60
Lowest quote, EUR 30.25 31.2

7. FOREIGN AND
NOMINEE
-REGISTERED
HOLDINGS ON 31
DECEMBER 2020

Book entries Votes Shareholders
qty % qty % qty %
Finnish total 15,839,313 76.44 86,752,177 94.67 14,045 99.60
Foreign total 61,980 0.30 61,980 0.07 46 0.33
Nominee 114,496 0.55 114,496 0.12 6 0.04
-registered
(foreign) total
Nominee 4,706,443 22.71 4,706,443 5.14 5 0.03
-registered
(Finnish) total
Total 20,722,232 100.00 91,635,096 100.00 14,102 100.00

8. LARGEST SHAREHOLDERS ON 31
DECEMBER 2020

Series K Series A Total % Votes %
1. Olvi Foundation        2,363,904 890,613 3,254,517 15.71 48,168,693 52.57
2. The Estate of Hortling Heikki 903,488 103,280 1,006,768 4.86 18,173,040 19.83
*)                                   
3. Hortling Timo Einari 212,600 49,257 261,857 1.26 4,301,257 4.69
4. Hortling-Rinne Marit     149,064 14,699 163,763 0.79 2,995,979 3.27
5. OP Custody Ltd, nominee register 2,318,839 2,318,839 11.19 2,318,839 2.53
6. Nordea Bank Abp, nominee register 1,299,816 1,299,816 6.27 1,299,816 1.42
7. Skandinaviska Enskilda Banken AB 1,040,991 1,040,991 5.02 1,040,991 1.14
(publ.) Helsinki branch, nominee
register
8. Varma Mutual Pension Insurance 828,075 828,075 4.00 828,075 0.90
Company
9. Ilmarinen Mutual Pension Insurance 675,000 675,000 3.26 675,000 0.74
Company
10. Hortling Pia Johanna 23,388 23,566 46,954 0.23 491,326 0.54
Others 79,812 9,745,840 9,825,652 47.41 11,342,080 12.37
Total 3,732,256 16,989,976 20,722,232 100.00 91,635,096 100.00
*) The figures include the
shareholder's own holdings and shares
held by parties in his control.

During January-December 2020, Olvi has not received any flagging notices in accordance with Chapter 2, Section 10 of the Securities Markets Act.

9. PROPERTY, PLANT AND EQUIPMENT
EUR 1,000
 1-12/ 2020   1-12/ 2019

Opening balance 208,701 196,540
Additions 31,923 34,197
Deductions and transfers -2,294 -2,286
Depreciation -22,625 -21,978
Exchange rate differences -11,549 2,228
Total 204,156 208,701
10. CONTINGENT LIABILITIES
EUR 1,000  
31 Dec 2020 31 Dec 2019

Pledges and contingent liabilities
   For own commitments 1,938 1,938

Leasing and rental liabilities:
   Due within one year 788 804
   Due within 1 to 5 years 398 306
   Due in more than 5 years 0 0
Leasing and rental liabilities total 1,186 1,110

Other liabilities 60 60

11. CALCULATION OF FINANCIAL RATIOS
In the summary of financial indicators (page 1), the Group presents figures directly derived from the consolidated income statement: net sales, operating profit and profit for the period, the corresponding percentages in proportion to net sales, as well as the earnings per share ratio. (Earnings per share = Profit belonging to parent company shareholders / Average number of shares during the period, adjusted for share issues.)

In addition to the consolidated financial statements prepared in accordance with IFRS, Olvi Group presents Alternative Performance Measures that describe the financial development of its business and provide a commensurate overall view of the company's profitability, financial position and liquidity.

The Group has applied the ESMA (European Securities and Markets Authority) new guidelines on Alternative Performance Measures that entered into force on 3 July 2016 and defined APMs as described below.

As an APM supporting net sales, the Group presents sales volumes in millions of litres. Sales volume is an important indicator of the extent of operations generally used in the industry.

The definition of gross margin is operating profit plus depreciation and impairment.

Equity per share = Shareholders' equity held by parent company shareholders / Number of shares at end of period, adjusted for share issues.

Equity to total assets, % = 100 * (Shareholders' equity held by parent company shareholders + non-controlling interests) / (Balance sheet total).

Gearing, % = 100 * (Interest-bearing debt - cash in hand and at bank) / (Shareholders' equity held by parent company shareholders + non-controlling interests)