Finland capital

Sievi Capital Plc Activity Report for January-March 2022

Sievi Capital Plc
Exchange announcement on May 5, 2022 at 8:00 a.m. EEST

Sievi Capital Plc Activity Report for January-March 2022

The strong growth of KH-Koneet ggroup continued, unrealized changes in fair value had a negative effect on Sievi VScapital result

This is the Business Review summary for January through March 2022. The full Business Review is attached to this release and is also available on the Company’s website at www.sievicapital.fi

January-March 2022

  • Operating profit amounted to -2.9 (3.7) million euros
  • Net income for the period was -2.4 (3.5) million euros
  • Earnings per share (non-diluted and diluted) was EUR -0.04 (0.06)
  • The net asset value per share at the end of the reporting period was EUR 1.57 (1.39)
  • The trailing 12-month return on equity was 14.6% (23.2%)
  • Gearing at the end of the reporting period was 10.3% (-13.2%)
  • KH-Koneet Group completed an acquisition in Sweden subsequent to the end of the reporting period
  • Tuomas Joensuu became the interim CFO of Sievi Capital in March

Unless otherwise indicated, the figures in parentheses are those of the corresponding period of the previous year. The information contained in the business review is unaudited. Sievi Capital does not consolidate the data of its subsidiaries in calculations at Group level line by line but recognize investments in companies at fair value through

CEO j.Also Majamaa:

“The development in the first quarter of 2022 was twofold. Four of our five target companies increased their net sales and three of them improved their profits. The best performance was achieved by KH-Koneet Group, which recorded substantial growth in revenue and EBITDA. After the reporting period, the KH-Koneet Group also acquired the Swedish machine rental company Törnells Maskinuthyrning, which strengthens its position in the Swedish market.

While there were many successes during the reporting period, our target companies faced a number of challenges and uncertainties, the most significant being related to the crisis in Ukraine, inflation and availability delays. These difficulties had the most impact on Indoor Group, where the start of the year was much slower than expected.

Fortunately, our target companies do not have business operations in Russia or depend on trade with Russia, so Russia’s armed offensive against Ukraine only has indirect impacts on us. It remains to be seen whether the crisis will have long-term impacts on consumer demand, or whether the impacts will be short-lived, as in the case of the coronavirus pandemic.

Sievi Capital’s first quarter result showed a loss due to unrealized changes in the value of investments, with the negative change in the value of the Indoor Group investment having the largest effect. The trailing 12-month return on equity at the end of the reporting period was 14.6%, exceeding our minimum long-term target level.

During the first months of the year, we paid particular attention to supporting our target companies in the organic and inorganic development of their business, as well as our strategic work. Our goal is to increase the shareholder value of Sievi Capital by increasing transparency, among other things. This Business Review marks the first time we have reported key net sales and profit figures, including comparison figures, for our target companies for the first three months of the year. There has also been a change in our organization during the review period. Tuomas Joensuu, who has been part of our investment team since 2019, became Sievi Capital’s interim CFO in March.

Future prospects

In line with its current strategy, Sievi Capital will continue to explore new investment opportunities. The company expects to make an average of 1-2 new investments per year, but the number of investments made may vary from year to year. For existing investments, the active development of the companies’ business operations will continue. Exit planning and assessment of exit opportunities will also continue. Sievi Capital will carry out strategic work during the current year, in which alternative strategies for increasing shareholder value that differ from the current strategy will also be considered.

Sievi Capital does not consolidate the data of its subsidiaries in the calculations at Group level line by line but recognizes the investments in the companies at fair value through profit or loss. Changes in the fair value of investments have a significant impact on the results of Sievi Capital. In addition to the development of the target companies themselves, the factors that influence the development of the fair values ​​of the investments include, for example, the general development of the various sectors and national economies as well as the development of their prospects, the development of the markets stock market and interest rates and other factors beyond the control of Sievi Capital. Moreover, the coronavirus pandemic increases uncertainty when it comes to anticipating development.

Sievi Capital’s financial objective is a return on equity of at least 13%, which the company considers realistic over the long term. Due to the nature of the business, the evolution of the company’s short-term results is subject to volatility that is difficult to predict. Therefore, Sievi Capital does not provide an estimate of the evolution of the result in 2022.

SIEVI CAPITAL PLC

Jussi Majamaa
CEO

FURTHER INFORMATION :
CEO Jussi Majamaa, tel. +358 400 412 127

DISTRIBUTION:
Nasdaq Helsinki Ltd
Main media
www.sievicapital.fi

Sievi Capital is a partner for Finnish entrepreneurs. We support the growth, performance and value creation of small and medium-sized enterprises while strengthening national competitiveness. We believe that we succeed together as joint venturers. Sievi Capital’s share is listed on Nasdaq Helsinki.

  • Sievi Capital T1_22 Activity report