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Sievi Capital Plc’s Business Review for January–September 2021
Sievi Capital Plc
Stock exchange release 29 October 2021 at 8:00 am EEST
Sievi Capital Plc’s Business Review for January–September 2021
Eventful quarter
This is the summary of the Business Review for January–September 2021. The full Business Review is attached to this release and is also available on the company’s website at www.sievicapital.fi.
July–September 2021
Operating profit was EUR 5.2 (8.2) million
Net profit for the period was EUR 4.1 (7.0) million
Earnings per share (undiluted and diluted) were EUR 0.07 (0.12)
Jussi Majamaa started as Sievi Capital’s CEO on 1 September 2021
Sievi Capital and Boreo signed a combination agreement on 29 September 2021
The agreement on the acquisition of Rakennuttajatoimisto HTJ was signed and the transaction was completed in October
After the end of the review period, Indoor Group decided on a significant dividend distribution
January–September 2021
Operating profit was EUR 18.3 (5.7) million
Net profit for the period was EUR 15.2 (4.9) million
Earnings per share (undiluted and diluted) were EUR 0.26 (0.08)
Net asset value per share at the end of the review period was EUR 1.55 (1.25)
Return on equity for rolling 12 months was 24.9% (16.2%)
Gearing at the end of the review period was -4.7% (-18.2%)
Figures in parentheses are figures from the corresponding period in the previous year, unless indicated otherwise. Information in the Business Review is unaudited. Sievi Capital does not consolidate the data of its subsidiaries into Group-level calculations line item by line item but recognises investments in the companies at fair value through profit or loss.
CEO Jussi Majamaa:
“I started as Sievi Capital’s CEO on 1 September 2021, in the middle of a major transformation in the company’s operations. In August, Sievi Capital and Boreo Plc signed a letter of intent related to their contemplated combination and, at the end of September, they signed a combination agreement and a merger plan. Assessment work for the combination has required – and its preparations still require – considerable time from our team and a wide range of external advisors. The decision on the proposed combination will be made at the general meetings of both companies, which are scheduled to take place in December 2021.
Alongside the combination preparations, we have continued active development of our target companies and the promotion of new investments. The M&A market has continued to be active and there are plenty of new investment opportunities available. During the third quarter, the acquisition announced by Logistikas in June was completed and the agreement on the acquisition of our new target company Rakennuttajatoimisto HTJ (hereinafter “HTJ”) was signed. The acquisition of HTJ was completed at the beginning of October and our close cooperation with the company began immediately. HTJ is a well-managed company with a strong market position. We see good potential in the company for growing operations organically and through possible acquisitions.
The development of our target companies’ business operations continued to be varying in the third quarter. We are satisfied with the development of Indoor Group and KH-Koneet Group this year. In particular, KH-Koneet Group’s success in Sweden after the major changes made last year has been great. The financial development of Logistikas has not fully met our expectations and that of Nordic Rescue Group has clearly been disappointing. However, we are convinced of the opportunities for these companies to improve their performance in the future when their operating environments return to normal.
Sievi Capital’s third-quarter result was again strong as a result of the positive value development of our largest target companies Indoor Group and KH-Koneet Group. Sievi Capital’s return on equity for rolling 12 months was 24.9%.”
Future outlook
Sievi Capital will continue to explore new investment opportunities in line with its strategy. The company plans 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.
Sievi Capital does not consolidate the data of its subsidiaries into Group-level calculations line item by line item but recognises investments in the companies at fair value through profit or loss. Changes in the fair values of the investments have a material impact on Sievi Capital’s results. In addition to the target companies’ own development, factors that influence the development of the fair values of the investments include, for instance, the general development of different sectors and national economies as well as changes in their outlooks, the development of stock market and interest rates and other factors beyond Sievi Capital’s control. Furthermore, the coronavirus pandemic increases uncertainty when it comes to anticipating development.
Sievi Capital’s financial target is a return on equity of at least 13%, the achievement of which the company considers to be realistic in the long term. Due to the nature of the business, the company’s short-term result development is subject to volatility that is difficult to predict. Therefore, Sievi Capital does not provide an estimate of the result development in 2021.
SIEVI CAPITAL PLC
Jussi Majamaa
CEO
FURTHER INFORMATION:
CEO Jussi Majamaa, tel. +358 400 412 127
DISTRIBUTION:
Nasdaq Helsinki Ltd
Major 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 companies and concurrently build national competitiveness. We believe that we succeed together as co-entrepreneurs. Sievi Capital’s share is listed on Nasdaq Helsinki.
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