DOVRE GROUP’S FINANCIAL STATEMENT RELEASE 1.1.–31.12.2020: A solid year despite the Covid 19 pandemic
DOVRE GROUP’S FINANCIAL STATEMENT RELEASE 1.1.–31.12.2020: A solid year despite the Covid 19 pandemic
Dovre Group Plc Financial Statement Release 25 Feb. 2021 at 8:45
Last year’s corresponding period is shown in parentheses.
January–December 2020
- Net sales was EUR 77.5 (83.1) million – decrease of 6.8% was impacted by the adverse effects of the COVID-19 pandemic and currency exchange rates.
- Project Personnel: Net sales totalled EUR 62.9 (77.0) million – decline of 18.3%.
- Consulting: Net sales totalled EUR 14.5 (6.1) million – increase of 136.7%.
- Operating result was EUR 2.4 (2.7) million – decrease of 13.1%. In 2019, the operating result included a non-recurring gain of EUR 0.8 million from the sale of the Kuukoti office premises.
- Profit before tax was EUR 2.2 (2.6) million and included EUR -0.2 (-0.1) million of finance items.
- Result for the period totalled EUR 1.6 (2.1) million.
- Earnings per share was EUR 0.016 (0.021).
- Net cash flow from operating activities was EUR 4.2 (1.3) million.
- Board of Directors proposes to the Annual General Meeting (AGM) to be held on 10 June 2021 that a dividend of EUR 0.01 (0.01) per share will be paid.
July–December 2020
- Net sales was EUR 34.3 (44.9) million – decrease of 23.6% following the temporary slowdown in demand caused by the COVID-19 pandemic and the adverse impacts of the currency exchange rates.
- Project Personnel: net sales totalled EUR 27.5 (41.8) million – decrease of 34.3%.
- Consulting: net sales totalled EUR 6.8 (3.1) million – increase of 118.3%.
- Operating result was EUR 1.2 (2.2) – decrease of 44.4%. In the comparison period, the operating result included a non-recurring gain of EUR 0.8 million from the sale of the office premises.
- Profit before tax was EUR 1.0 (2.2) million including EUR -0.2 (0.1) million of finance items.
- Result for the period was EUR 0.5 (1.9) million.
- Earnings per share was EUR 0.005 (0.018).
- Net cash flow from operating activities was EUR 1.8 (2.7) million.
Outlook for 2021:
Based on the prevailing Corona situation Dovre Group expects its revenue in 2021 to increase slightly from 2020. Dovre will give its guidance for the operating profit in 2021 together with its financial reporting at the latest on April 28, 2021.
CEO ARVE JENSEN:
Dovre’s net sales in 2020 decreased by 6.8% to 77.5 million euros following the adverse impacts of the COVID-19 pandemic on demand and the effects of the weak Norwegian krone against the euro on our euro-nominated net sales. In constant currencies, our net sales were flat at 82.7 million euros. Despite the decline in net sales, we were able to reach our original profitability guidance for 2020 with operating profit excluding non-recurring items increasing to 2.2 million euros. I am pleased with this performance considering the exceptional market environment in 2020.
Starting from March, the impacts of the imposed COVID-19-related travel and other restrictions started to show especially in our Project Personnel business. Norway, our largest market with a strong oil and gas focus, was severely hit by restrictions in March–April, and we adjusted our operations accordingly with temporary layoffs in Norway.
Business demand started to recover gradually in H2, with Singapore leading the return to normal and Norway following after the summer – supported by the introduced tax changes for the oil companies – and the other units gradually. In the Consulting business in Norway and Finland, some projects were delayed, but the Consulting market has generally been less impacted. The positive market development continued in Q4.
Our widespread client projects and locations have given us the resilience to continue our business during the pandemic. Dovre’s healthy financial position and timely-implemented cost-control measures have also supported our business. I have been particularly proud of our employees and consultants’ ability to keep the projects running under these exceptional conditions. I am also very pleased that several existing clients have used their options to extend agreements and that we have won several new frame agreements and single contracts in both business areas.
At the beginning of 2020, we were expecting to see further growth through the materialisation of synergies from the 2019 Tech4Hire acquisition and the benefits of the organisational changes implemented in Norway at the beginning of 2020. Despite the pandemic, we have seen these benefits materialise in the form of a stronger client base and a new strengthened organisation. Competition is still strong in our markets, but at the same time the availability of consultants improved as some projects have been delayed or put on hold.
In 2021, our focus will be to continue our strategic road on profitable growth. We will take further active steps to diversify our services into the energy sector where a major ongoing transformation is moving the sector towards a more extensive use of renewable and wind energy. We also aim at increasing the share of Consulting of our total business and continue the work in this field to include new clients and projects in transportation, buildings and construction, ICT, defence and health sectors.
At the moment, we expect the negative effects of the pandemic to impact our business to some degree at least for the next six months’ period. We continue to monitor the development of the pandemic and COVID-19 vaccination schedules, oil price development, and other market movements. If necessary, we will continue to adjust our operations accordingly.
GROUP’S KEY FIGURES
| EUR million | 7–12 2020 | 7–12 2019 | Change % | 1–12 2020 | 1–12 2019 | Change % |
| Net sales | 34.3 | 44.9 | -23.6 | 77.5 | 83.1 | -6.8 |
| Operating result | 1.2 | 2.2 | -44.4 | 2.4 | 2.7 | -13.1 |
| % of net sales | 3.5 | 4.8 | 3.0 | 3.3 | ||
| Profit before taxes | 1.0 | 2.2 | -56.6 | 2.2 | 2.6 | -17.9 |
| % of net sales | 2.8 | 4.9 | 2.8 | 3.2 | ||
| Result for the period | 0.5 | 1.9 | -72.4 | 1.6 | 2.1 | -21.4 |
| % of the net sales | 1.5 | 4.2 | 2.1 | 2.5 | ||
| Net cash flow from operating activities | 1.8 | 2.7 | -33.6 | 4.2 | 1.3 | 231.8 |
| Net debt | -2.4 | 0.0 | -2.4 | 0.0 | ||
| Debt-equity ratio (Gearing), % | -10.1 | 0.2 | -10.1 | 0.2 | ||
| Earnings per share, EUR | ||||||
| Undiluted | 0.005 | 0.018 | -72.6 | 0.016 | 0.021 | -22.7 |
| Diluted | 0.005 | 0.018 | -72.6 | 0.016 | 0.021 | -22.7 |
NET SALES AND PROFITABILITY
Net sales in January–December
In 2020, Dovre Group’s net sales decreased by 6.8%, totalling EUR 77.5 (83.1) million. The decrease was mainly impacted by the slowdown in demand caused by the COVID-19 pandemic and the adverse impacts of the currency exchange rates on Group net sales. Tech4Hire’s net sales are reported as part of the Group’s Project Personnel segment as of 1 May 2019.
Project Personnel accounted for 81 (93)% and Consulting for 19 (7)% of the Group’s net sales. Net sales for Project Personnel decreased by 18.3%, totalling EUR 62.9 (77.0) million. Net sales for Consulting increased by 136.7%, totalling EUR 14.5 (6.1) million.
Considering the retrospective impact of the organisational changes in Norway in January 2020 to January–December 2019 figures, Project Personnel would have accounted for 83% of net sales and Consulting for 17% of new sales in the comparison period in 2019. Consequently, net sales in the Project business would have declined by 9.2% year-on-year in the period under review. In the Consulting business, net sales would have increased by 5.1% year-on-year.
By market area, EMEA’s net sales totalled EUR 59.9 (66.4) million, accounting for 77 (80)% of the Group’s net sales during the year. Net sales for AMERICAS were EUR 7.7 (9.6) million, accounting for 10 (12)% of the Group’s net sales. Net sales for APAC were EUR 9.9 (7.2) million, accounting for 13 (9)% of the Group’s net sales.
Year-on-year fluctuations in the foreign currency exchange rates, especially the depreciation of the Norwegian krone against the euro, had a clear negative impact on the Group’s net sales in the period under review. At constant currencies, net sales would have been on a 2019 level despite the adverse impact of the pandemic.
Several existing clients used their options to extend agreements in 2020, and in addition Dovre won several new frame agreements and single contracts in both business units.
| Net sales by reporting segment EUR million | 7-12 2020 | 7-12 2019 | Change % | 1-12 2020 | 1-12 2019 | Change % |
| Project Personnel | 27.5 | 41.8 | -34.3 | 62.9 | 77.0 | -18.3 |
| Consulting | 6.8 | 3.1 | 118.3 | 14.5 | 6.1 | 136.7 |
| Group total | 34.3 | 44.9 | -23.6 | 77.5 | 83.1 | -6.8 |
| Net sales by market area EUR million | 7-12 2020 | 7-12 2019 | Change % | 1-12 2020 | 1-12 2019 | Change % |
| EMEA | 26.2 | 36.2 | -27.7 | 59.9 | 66.4 | -9.8 |
| AMERICAS | 2.6 | 4.9 | -46.9 | 7.7 | 9.6 | -19.3 |
| APAC | 5.6 | 3.9 | 43.7 | 9.9 | 7.2 | 37.2 |
| Group total | 34.3 | 44.9 | -23.6 | 77.5 | 83.1 | -6.8 |
Dovre Group’s market areas are:
- EMEA: Norway, Middle East, Finland
- AMERICAS: Canada, US
- APAC: Singapore
Dovre’s other operating income totalled EUR 0.2 (0.8) million euros.
Net sales in H2
In H2, Dovre Group’s net sales decreased by 23.6% to EUR 34.3 (44.9) million, mainly due to the slowdown in demand caused by the COVID-19 pandemic and the adverse impacts of the currency exchange rates on Group net sales.
Project Personnel accounted for 80 (93)% and Consulting for 20 (7)% of the Group’s net sales. Project Personnel’s net sales decreased by 34.3% to EUR 27.5 (41.8) million and net sales in Consulting increased by 118.3%, totalling EUR 6.8 (3.1) million. Reported net sales figures are impacted, in addition to general business demand, by the organisation changes in Norway in January 2020.
Profitability in January–December
In 2020, the Group’s operating result totalled EUR 2.4 (2.7) million, corresponding to 3.0 (3.3)% of net sales. Project Personnel’s operating result was EUR 1.9 (2.4) million. Consulting business area’s operating result was EUR 1.5 (0.6) million. The operating result of the Group’s Other functions was EUR -0.7 (-0.1) million. In the comparison year, the figures included the sales gain of EUR 0.8 million from the divestment of office premises in September 2019. The unallocated costs were EUR -0.3 (-0.3) million
Considering the retrospective impact of the organisational changes in Norway in January 2020 to January–December 2019 figures, the operating profit of Project Personnel would have been EUR 1.7 million and the operating profit of the consulting business EUR 1.3 million in the comparison period of 2019.
| Operating result EUR million | 7-12 2020 | 7-12 2019 | Change % | 1-12 2020 | 1-12 2019 | Change % |
| Project Personnel | 0.9 | 1.5 | -40.4 | 1.9 | 2.4 | -20.6 |
| Consulting | 0.8 | 0.4 | 81.5 | 1.5 | 0.6 | 130.0 |
| Other functions** | -0.3 | 0.4 | -196.8 | -0.7 | -0.1 | -1,056.6 |
| Unallocated * | -0.1 | -0.2 | 6.3 | -0.3 | -0.3 | -12.7 |
| Group total | 1.2 | 2.2 | -44.4 | 2.4 | 2.7 | -13.1 |
* Unallocated expenses include the amortisation of customer agreements and relations, expenses recorded as a result of adopting of IFRS 16 in 2019.
**In 2019, gain from the sale of Kuukoti office property included.
Profitability in H2
In H2, the Group’s operating result was down to EUR 1.2 (2.2) million. Project Personnel’s operating result was EUR 0.9 (1.5) million. Consulting’s operating result totalled EUR 0.8 (0.4) million. The operating result of the Group’s Other functions was EUR -0.3 (0.4) million. In the comparison year, the figures included the sales gain of EUR 0.8 million from the divestment of office premises in September 2019. The unallocated costs were EUR -0.3 (-0.3) million. Employee benefit expenses decreased broadly in line with the net sales, by 6.2% to EUR 71 (75.6) million.
Result
The Group’s result before taxes was EUR 2.2 (2.6) million. The result included EUR -0.2 (-0.1) million of finance items, including an income of EUR 0.2 (0.2) million as a result of fair value of SaraRasa Bioindo investment through profit and loss. Dovre owns 19.9% of SaraRasa shares.
The Group’s result for the period was EUR 1.6 (2.1) million. The Group’s earnings per share was EUR 0.02 (0.02). The Group’s return on average capital employed before taxes (ROI) was 7.9 (10.3)%.
CASH FLOW, FINANCING AND INVESTMENTS
On 31 December, the Group’s balance sheet total was EUR 44.5 (49.5) million. The Group’s cash and cash equivalents totalled EUR 8.5 (5.8) million. In addition, the Group has unused credit limits.
At year-end, the equity ratio was 53.6 (49.2)% and the debt-equity ratio (gearing) -10.1 (0.2)%. The interest-bearing liabilities amounted to EUR 6.1 (5.8) million, accounting for 13.8 (11.8) % of the Group’s shareholders’ equity and liabilities. A total of EUR 4.2 (3.1) million of the Group’s interest-bearing liabilities were current and a total of EUR 1.9 (2.7) million non-current.
Net cash flow from operating activities was EUR 4.2 (1.3) million, which includes EUR 1.9 (-1.1) million change in working capital. In the comparison period, the Group’s cash flow includes Tech4Hire’s cash flows from 1 May 2019. The increase in trade and other receivables and decrease in trade and other payables, in particular, had an effect on the cash flow.
Net cash flow from investing activities was EUR -1.0 (-0.2) million. Gross investments totalled EUR 0.0 (0.1) million, proceeds from sale of tangible assets totalled EUR 0.0 (1.6) million, and business acquisition (additional purchase price for Tech4Hire acquisition) amounted to EUR -1.0 (-1.8) million.
Net cash flow from financing activities was EUR -0.1 (-0.4) million. It includes a directed share issue of 0.3 million euros related to the payment of additional purchase price to the sellers of Tech4Hire (share issue of 0.4 million euros in 2019 related to the Tech4Hire acquisition). In 2020, the Group paid a total of EUR 1.0 (1.0) million in dividends. The balance sheet goodwill totalled EUR 16.4 (17.4) million on 31 December. No indications of impairment exist.
CHANGES IN THE GROUP STRUCTURE
Legal restructuring in Norway
At the beginning of January 2020, Dovre Group reorganised its business in Norway and transferred a part of the business from the Project Personnel segment to be reported as a part of the Consulting segment. The new organisational structure combined those businesses that have specific features in the energy sector as one entity, and those with core expertise in consulting as one entity, thereby enabling Dovre’s personnel to utilise their expertise better in the management of customer projects and in developing Dovre’s business.
Following the reorganisation, Dovre Group has two companies in Norway: Dovre Group Energy AS, earlier Dovre Group Projects AS, focuses on supplying project personnel to clients within the energy sector. Dovre Group Consulting AS focuses on consulting within project management and supplying project personnel to clients within industries other than energy.
Dovre Group Energy AS is reported as part of Project Personnel segment and Dovre Group Consulting AS as part of Consulting segment in the Group’s financial reporting. The changes had no effect on the legal structures in other units outside of Norway.
New subsidiary in Russia
In February 2020, Dovre Group expanded its offering to a new geographical area of Western Russia by establishing a new subsidiary company in St. Petersburg (Dovre ooo). The company initially planned to offer project personnel, specialists and advanced project services for both foreign and Russian companies operating in Russia as well as administrative support and other back office services for all Dovre companies internally to improve the cost efficiency and profitability of Dovre, but the COVID-19 pandemic has significantly slowed down the start of operations.
RESEARCH AND PRODUCT DEVELOPMENT
The Group’s research and development costs were EUR 0.2 (0.2) million, which equals 0.2 (0.2)% of the Group’s net sales.
PERSONNEL
On 31 December, Dovre Group employed 610 (691) people: 521 (653) of which were employed by Project Personnel, 86 (35) by Consulting, and 3 (3) by Other functions. The changes especially reflect the organisational change implemented in Norway at the beginning of the year. In addition, Dovre has adjusted its operations from Q2 onwards in Norway by implementing temporary layoffs to meet the current changes in demand.
During 2020, the average number of personnel employed by the Group was 629 (620). Project Personnel employed 541 (580) and Consulting 85 (37) people. In the Project Personnel business area 22 (30)% of the employees were independent contractors.
The Group's personnel expenses in 2020 were EUR 70.9 (75.6) million.
| Personnel, average | 7-12 2020 | 7-12 2019 | Change % | 1-12 2020 | 1-12 2019 | Change % |
| Project Personnel | 507 | 644 | -21.3 | 541 | 580 | -6.7 |
| Consulting | 84 | 37 | 127.0 | 85 | 37 | 129.5 |
| Other functions | 3 | 3 | 0.0 | 3 | 3 | 0.0 |
| Group total | 594 | 684 | -13.2 | 629 | 620 | 1.5 |
GROUP MANAGEMENT
Dovre Group appointed Ms Sirpa Haavisto (M.Sc. Econ.) as the Group’s new CFO as of 1 October 2020, following the former CFO, Ms Mari Paski’s resignation from the position in July 2020. Ms Haavisto reports to CEO Arve Jensen and is a member of the Dovre Group's Executive team.
At the end of 2020, the Executive Team consists of Arve Jensen (CEO), Stein Berntsen (President, Consulting), and Sirpa Haavisto (CFO).
SHARES, SHAREHOLDERS AND STOCK OPTIONS
Share capital and trading
Dovre Group Plc has one series of shares. Each share entitles its holder to one vote. Dovre Group Plc's shares are listed on Nasdaq Helsinki Oy.
The share capital of Dovre Group Plc on 1 January 2020 and 31 December 2020 was EUR 9,603,084.48. The number of shares was 101,946,747 on 1 January 2020 and 102,956,494 on 31 December 2020.
On 31 December 2020, Dovre Group’s share capital was EUR 9,603,084.48 and the total number of shares 102,956,494. The number of shares increased during Q1 2020 when Dovre Group issued 1,009,747 new shares to the sellers of Tech4Hire AS, originally acquired in spring 2019, in a directed share issue. The issue was related to the payment of an additional purchase price to the sellers of Tech4Hire, where a part of the additional consideration was used to subscribe for new shares in Dovre Group Plc. The share subscription price was EUR 0.34 and the total subscription price was EUR 343,314. The share subscription price was based on the trade-weighted average price of Dovre Group's shares on Nasdaq Helsinki between 7 February 2020 and 13 February 2020. The share subscription price was recorded in full in the company's invested unrestricted equity fund.
In 2020, altogether 31.1 (50.0) million Dovre Group shares were exchanged on Nasdaq Helsinki Ltd., corresponding to a trade of approximately EUR 8.7 (11.9) million. The trading volume in the comparison year was impacted by the share transactions made by the company's largest shareholders in early November 2019.
The volume weighted average price of Dovre share was 0.28 (0.24), the lowest quotation was EUR 0.20 (0.20) and the highest EUR 0.37 (0.34). On 31 December 2020, the closing quotation was EUR 0.28 (0.29). The year-end market capitalisation was approximately EUR 28.7 (29.6) million.
Own shares
Dovre Group did not repurchase the Company’s own shares during the period under review. At the end of December 2020, Dovre Group Plc held 870,337 of its own shares, representing approximately 0.8% of all the company's shares and votes.
Shareholders and holdings of the Board of Directors and the CEO
On 31 December 2020, the number of registered shareholders of Dovre Group Plc totalled 4,016 (3,875), including 10 (8) nominee-registers. The share of nominee-registered shares was 4.2 (2.4)% of the Group’s shares.
On 31 December 2020, members of the Group’s Board of Directors and the CEO held, including holdings through controlled and/or influential companies and family members living in the same household, a total of 8,147,751 (7,997,751) shares in the company, representing 7.9 (7.8)% of all the shares.
| Holdings of Board and CEO 31/12/2020 | ||
| Shares, | Percentage of | |
| Name | Pcs | shares |
| Svein Stavelin | 334 613 | 0,3 |
| Ilari Koskelo 1) | 7 279 653 | 7,1 |
| Antti Manninen 2) | 533 485 | 0,5 |
| Kristine Larneng | 0 | 0,0 |
| Board members, total | 8 147 751 | 7,9 |
| Arve Jensen, CEO | 80 000 | 0,1 |
1 Including 1,300,000 shares owned by Navdata Oy, a company controlled by Ilari Koskelo.
2 Including 300,000 shares owned by Amlax Oy, a company controlled by Antti Manninen, and 100,000 shares owned by Antti Manninen’s influential company Rio Group Oy.
One flagging notification was issued during the financial year. The ownership of Joensuun Kauppa ja Kone Oy to shares and voting rights in Dovre Group Plc increased above 10% in August. The combined holding of Joensuun Kauppa ja Kone Oy and K22 Finance Oy (both entities controlled by Kyösti Kakkonen) is 11.96%.
Shareholder agreements
Dovre is not aware of any shareholder agreements pertaining to share ownership or the use of voting rights.
Stock options
At the end of the period under review, Dovre Group had no open option plans. The subscription period for the 2013C option plan ended on 28 February 2020. The share subscription period and price per series under the 2013C option plan was as follows: subscription price EUR 0.43; subscription period 1 March 2017 – 28 February 2020. No shares were subscribed to during this period.
More information about the shares, shareholders and stock options of Dovre Group is available at www.dovregroup.com/investors.
Long-term incentive programmes 2018–2020
The Board of Directors decided on a long-term share-based remuneration and incentive programme for the top management of Dovre Group in June 2018. The remuneration is based on annually set performance conditions and a service condition, and the key metric is operating profit.
The executive is responsible for personnel income tax on award. The shares will be awarded when the vesting period ends at the beginning of 2021.
Estimated number of shares earned
| Year | Shares, pcs |
| 2018 | 213,960 |
| 2019 | 354,564 |
| 2020 | 290,105 |
| Total accrued | 858,629 |
ANNUAL GENERAL MEETING AND THE AUTHORISATIONS OF THE BOARD OF DIRECTORS
Dovre Group Plc’s Annual General Meeting (AGM) was held on 28 April 2020. The AGM adopted the financial statements and consolidated financial statements for 2019 and discharged the members of the Board of Directors and the CEO from liability for the financial year ending on 31 December 2019.
The AGM decided to authorise the Board of Directors to decide according to their own consideration on a dividend distribution of a maximum of EUR 0.01 for the financial year 2019. On 26 October 2020, the Board of Directors of Dovre Group Plc decided based on this authorisation that a dividend of EUR 0.01 per share will be paid to a shareholder who is registered in the company’s shareholder register maintained by Euroclear Finland Ltd on the date of record of 2 November 2020. The dividend was paid on 10 November 2020.
The AGM decided that the number of Board members shall be a total of four (4). Svein Stavelin, Ilari Koskelo, Kristine Larneng and Antti Manninen were re-elected as members of the Board. The AGM resolved that the chairman of the Board is paid EUR 35,000, the vice chairman of the Board EUR 25,000 and each other member of the Board EUR 22,000 per year. The annual compensation is to be paid in cash. In addition, reasonable travel expenses are also compensated.
The AGM elected Audit firm BDO Oy as the Company's auditor. BDO Oy has informed that Authorised Public Accountant Ari Lehto will be the principal auditor. The auditor’s fee shall be paid according to the approved invoice of the auditor.
The AGM authorised the Board of Directors to decide on the repurchase of the Company’s own shares and to decide on the issuance of new shares and/or the conveyance of own shares held by the Company and/or the granting of special rights referred to in Chapter 10, Section 1 of the Finnish Companies Act. Both authorisations cover a maximum of 10,100,000 shares, which corresponds to a maximum of 9.9% of the total number of shares in the company. The authorisations are valid until 30 June 2021 and revoke the previously granted, corresponding authorisations.
The Board did not use the authorisation granted in 2019 or 2020 to decide on the repurchase of its own shares in 2020. In February, the Board of Directors used the authorisation granted by the 2019 AGM to decide on the issuance of new shares when it decided on the directed share issue to the sellers of Tech4Hire in February 2020. The authorisation granted by the 2020 AGM is unused.
The decisions of the General Meeting are available in full at https://www.dovregroup.com/investors/share-and-ownership.html#authorizations
SHORT-TERM RISKS AND UNCERTAINTIES
In the Project Personnel business area, the Group’s most significant risks include the cyclicality of the clients’ business. Market developments in Norway are particularly important for Project Personnel due to the business area’s strong position in the Norwegian market. In addition, expansion to new client segments requires expenditure and includes risks. The business area’s other challenges are maintaining its competitiveness and profitability. Project Personnel business is project-based by nature, thus adding an element of uncertainty to forecasting. From time to time, there might be a local dependence on one major project or client. Dovre Group is responsible for the work performed by its consultants. However, the company has no overall responsibility for project delivery.
In the Consulting business area, general economic uncertainty does not affect as directly the demand for the Group’s services. This is mainly due to the fact that one of Group’s main clients, the Norwegian public sector, aims to invest counter-cyclically. Project delivery involves minor risks due to both clients and the Group’s own personnel such as project delays or loss of key personnel.
Dovre Group holds a minority share in SaraRasa Bioindo Pte. Ltd. (Bioindo), a company producing pellets from wood residue. Bioindo’s production unit is located in Indonesia and is thus exposed to high country risk. Other significant risks include risks relating to commercial agreements, especially feedstock purchase and end-product sale agreements. Dovre Group accounts for the investment as a fair value through profit and loss.
The Group’s reporting currency is euro. The Group’s most important functional currencies are the Norwegian crown, the Canadian dollar, the Singaporean dollar, and the United States dollar. Although the Group’s sales and corresponding expenses are mainly in the same currency, currency fluctuations can affect the Group’s net sales and operating result. Foreign currency denominated assets and liabilities can also result in foreign exchange gains or losses. Foreign exchange risks are hedged, when necessary, centrally in the Group.
OTHER EVENTS DURING THE REPORTING PERIOD
In December 2020, Dovre Group's partly owned equity investment (ownership 19.86%) SaraRasa Bioindo Pte. Ltd.'s fully owned subsidiary PT SaraRasa Biomass (Company) decided to expand its production at the factory site in Surabaya.
The current production capacity will increase by over 20% and the warehouse storage capacity by over 100% compared to 2020. The new production construction is expected to be completed by August 2021. The expansion at the current site is expected to improve the profitability of the factory due to economy of scale and it will be financed with the Company's excess cash reserves.
EVENTS AFTER THE REPORTING PERIOD
Dovre Group confirmed its 2020 guidance and issued preliminary 2020 net sales and operating profit figures on 3 February. It also announced the postponement of its planned Annual General Meeting 2021 from 8 April to 10 June, due to COVID-19 vaccine delays. The company also disclosed its intention to publish its financial guidance at the latest in connection with its Q1 2021 business review on 28 April 2021.
BOARD OF DIRECTORS’ PROPOSAL FOR DIVIDEND
The parent company’s distributable funds were EUR 18,470,517.04 on 31 December 2020. The Board of Directors proposes to the Annual General Meeting to be held on 10 June 2021 that a dividend of EUR 0.01 (0.01) per share to be paid.
No significant changes have occurred in the company’s financial position after the end of the financial year. The proposed distribution of a dividend poses no risk to the company’s financial standing.
Espoo, 24 February 2021
DOVRE GROUP PLC
BOARD OF DIRECTORS
For additional information, please contact:
Arve Jensen, CEO
[email protected]
tel. +47 90 60 78 11
Sirpa Haavisto, CFO
[email protected]
tel. +358 20 436 2000
Financial reporting in 2021
Dovre Group releases its financial reports in 2021 as follows:
- Q1 trading statement for 1 January–31 March 2021 on Wednesday, 28 April 2021
- Half-year financial report for 1 January–30 June 2021 on Wednesday, 28 July 2021
- Q3 trading statement for 1 January–30 September 2021 on Wednesday, 27 October 2021
The company’s Annual General Meeting is to be held on Thursday, 10 June 2021. Dovre Group’s Board of Directors will summon the meeting at a later date. The Annual Report 2020, which includes the company’s financial and non-financial statements, the report of the Board of Directors, and the corporate governance statement, will be published online during week 11.
Distribution
Nasdaq Helsinki Ltd
Major media
www.dovregroup.com
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