23.11.2022 - 08:30

Anora’s Interim Report January–September 2022: Net sales grew in Q3 – strong performance by Globus Wine

Anora Group Plc Stock Exchange Release 23 November 2022 at 8:30 am EET

Anora’s Interim Report January–September 2022: Net sales grew in Q3 – strong performance by Globus Wine

This release is a summary of Anora Group Plc's Interim Report January–September 2022. The complete report is attached to this release and is also available on the company website at: www.anora.com/en/investors

Q3 22 in brief

Net sales were EUR 181.9 million, 10.2% growth compared to the Q3 21 pro forma net sales of EUR 165.0 million, net sales excluding Globus Wine was EUR 159.4 million
Comparable EBITDA was EUR 23.4 million or 12.8% of net sales (Q3 21 pro forma: EUR 30.1 million or 18.2%)
Net cash flow from operating activities was EUR 7.3 (-5.1) million
Earnings per share EUR 0.12 (Q3 21 pro forma: 0.21)
The acquisition of Globus Wine was closed on 1 July 2022 and Globus Wine is consolidated in Anora since acquisition date

January–September 2022 in brief

Net sales were EUR 481.1 million, 4.7% growth compared to the Q1-Q3 21 pro forma net sales of EUR 459.4 million, net sales excluding Globus Wine was EUR 458.6 million
Comparable EBITDA was EUR 55.3 million or 11.5% of net sales (Q1-Q3 21 pro forma: EUR 70.4 million or 15.3%)
Net cash flow from operating activities was EUR -36.4 (-6.7) million
Earnings per share EUR 0.21 (Q1-Q3 21 pro forma: 0.37)
Net debt/comparable EBITDA (rolling 12 months) was 3.6 (2.9)

Guidance

Guidance remains unchanged: Anora’s comparable EBITDA in 2022 is expected to be between EUR 75-85 million. This corresponds to the pre-pandemic level and takes into account the annual impact of EUR 4.6 million of the divestment of Anora brands due to the 2021 merger.

Capital Markets Day 29 November 2022

Anora hosts a Capital Markets Day for investors, analysts, bankers and media on Tuesday 29 November 2022 at Gjelleråsen, Norway. At the event, Anora’s Executive Management Team will present the company’s growth strategy, financial targets and sustainability roadmap. More information on anora.com/en/investors/cmd.

Key figures

	Q3 22	Q3 21 IFRS	Q1-Q3 22	Q1-Q3 21 IFRS	2021
Net sales, EUR million	181.9	114.0**	481.1	272.5***	478.2
Comparable EBITDA, EUR million	23.4	20.2**	55.3	40.2***	71.7
% of net sales	12.8	17.7**	11.5	14.8***	15.0
EBITDA, EUR million	21.8	16.9	49.0	31.6	62.9
Comparable operating result, EUR million	14.4	15.2	30.7	27.6	51.2
% of net sales	7.9	13.3	6.4	10.1	10.7
Operating result, EUR million	12.8	11.9	24.5	18.9	42.4
Result for the period, EUR million	7.9	8.7	14.4	14.0	31.2
Earnings per share, EUR	0.12	0.19**	0.21	0.35***	0.67
Net cash flow from operating activities, EUR million	7.3	-5.1	-36.4	-6.7	50.8
Net debt / comparable EBITDA (rolling 12 months)	3.6*	2.9****	3.6	2.9****	1.8
Personnel end of period	1 212	1 100	1 212	1 100	1 055

*If including Globus Wine rolling 12-month figures, net debt/comparable EBITDA (rolling 12 months) would have been approx. 3.4 for Q1-Q3/22.

**Pro forma figures Q3 21: net sales EUR 165.0 million; comparable EBITDA EUR 30.1 million or 18.2% of net sales; EPS EUR 0.21.

***Pro forma figures Q1-Q3 21: net sales EUR 459.4 million; comparable EBITDA EUR 70.4 million or 15.3% of net sales; EPS EUR 0.37

****If calculated using pro forma figures, net debt / comparable EBITDA would have been 1.6 for Q3 21 and 1.6 for Q1-Q3 21.

CEO Pekka Tennilä:

I am pleased with our net sales growth in the third quarter. Our net sales grew in double digits, to EUR 181.9 million, thanks to our acquisition of Globus Wine in Denmark. Net sales excluding Globus Wine was EUR 159.4 million. The comparable EBITDA declined by 22.3% to EUR 23.4 million due to higher operating expenses and lower gross margin than in the comparison year.

The decline in profitability was related mainly to the normalisation after Covid-19, with wine and spirits volumes in the monopolies continuing to see strong declines. In addition, our operating expenses were higher and the relative gross margin was lower due to the high input costs including barley price at a record-high level. We have implemented price increases across all of our businesses and markets, but due to the time lag between the increase in input costs and our price increases, the gross margin declined.

In spirits, net sales were at last year’s level supported by continued growth in International where the net sales grew in exports, Baltics and DFTR. In the monopoly markets, our net sales declined following the declining market, but we gained market shares in all countries showing the strength of our brands and innovations. As an example, our own premium gin brand – Skagerrak – won full distribution in the Norwegian monopoly.

The net sales growth in wine was driven by Globus Wine’s strong performance in Denmark. Globus Wine continued to gain market share and further strengthened its position as the market leader. In the monopoly markets, net sales declined largely following a declining market and due to the earlier partner losses, but we are working hard to mitigate the losses and we have already been successful with gaining new partners such as Zonin and AdVini. In our own wines, we saw positive development driven by the relaunch of the Chill Out brand across the Nordics. Our tender winning rate has been good and we have launched several interesting novelties during the quarter. We will be able to expand Globus Wine’s strong own wine portfolio to high-volume wine segments in Sweden, Norway and Finland.

The net sales growth in Industrial was driven by higher sales prices. Volumes in industrial products remained below last year’s level as we continued to run the Koskenkorva Distillery at a lower running speed to mitigate the push from the high cost of barley.

Our post-merger integration work has progressed as planned and on schedule. During the third quarter, we completed the product transfers to Anora’s in-house logistics centre in Sweden. With this, the logistics integration is now completed. The run rate of annualised net synergies at the end of Q3 22 was EUR 5.2 million, including the annual impact of EUR 4.6 million from the divestment of brands in connection with the completion of the merger.

Looking at the rest of the year, we reiterate our guidance and expect the comparable EBITDA in 2022 to be between EUR 75-85 million. The barley crop this year was good. The prices have come down from the peak level earlier this year, but uncertainty in the global grain market remains a fact. The barley price level is expected to stay high, and due to overall uncertainties the cost pressure in other raw materials is expected to continue.

The last quarter of the year is important for us, and we have yet again a fantastic offering of products for the Christmas season, and we are well prepared for the high-season. I would like to thank everyone at Anora for their hard work and strong commitment.

The next milestone on our journey is the Capital Markets Day which we are hosting on 29 November 2022. Welcome to join the event and hear more about our growth strategy, financial targets and sustainability roadmap!

Outlook for 2022

Market outlook

In 2022, the volumes in the monopolies are expected to be significantly lower than in 2020 and 2021 as the lifting of COVID-19 restrictions result in higher on-trade, border trade and duty-free sales. Input costs are expected to remain at a high level.

Guidance

Anora’s financial reporting and Annual General Meeting in 2023

Anora will publish financial reports in 2023 as follows:

28 February 2023: Financial Statements Bulletin for 2022
11 May 2023: Interim Report for January-March 2023
25 August 2023: Half-Year Report for January-June 2023
9 November 2023: Interim Report for January-September 2023

Anora applies a silent period of 30 days before the publication of financial reports.

The Annual Report 2022 including the financial statements, Board of Directors' report, the Corporate Governance statement and the remuneration report will be published in English and Finnish as a PDF file on Anora’s website by the end of week 12. The Annual Report includes also the Sustainability Report.

Anora Group Plc’s Annual General Meeting (AGM) 2023 is planned to be held on Wednesday 19 April 2023 in Helsinki. The Board of Directors will summon the AGM later.

ANORA GROUP PLC

Further information:

Pekka Tennilä, CEO

Sigmund Toth, CFO

Contacts:

Analysts and investors: Tua Stenius-Örnhjelm, Investor Relations, tel. +358 40 748 8864

Media: Petra Gräsbeck, Corporate Communications, tel. +358 40 767 0867

Results presentation:

CEO Pekka Tennilä and CFO Sigmund Toth will present the report today at 11:00 am EET. The presentation will be held as a Microsoft Teams Meeting and we recommend that participants join the event using the online meeting option: Join meeting here

It is also possible to dial-in to the meeting about 5 minutes earlier at the following numbers: