Olvi Group’s Interim Report, 1 January to 31 March 2021 (3 Months)

OLVI PLC                Interim Report 29 April 2021 at 9:00 am

Olvi Group’s Interim Report, 1 January to 31 March 2021 (3 Months)

Interim Report in brief

Olvi Group’s first-quarter sales volume, net sales and operating profit increased on the previous year. Easter sales fell into the first quarter and exports increased; this boosted the Group’s overall development. The Group’s financial standing remained on a good level.

Near-term outlook

Olvi’s operating profit for fiscal year 2021 is expected to remain on the previous year’s good level. Second-quarter earnings development will still be affected by sales channel restrictions due to the corona pandemic, as well as weather conditions in the upcoming summer season.

Consolidated key ratios

	1–3 / 2021	1–3 / 2020	Change % /pp	1–12 / 2020
Sales volume, Mltr	163.9	153.2	7.0	765.9
Net sales, MEUR	85.3	84.6	0.9	414.9
Gross profit*, MEUR	34.7	35.5	-2.3	178.0
% of net sales	40.6	41.9		42.9
Operating profit, MEUR	8.1	7.8	2.7	56.4
% of net sales	9.4	9.3		13.6
Net profit for the period, MEUR	6.9	5.4	27.7	40.9
% of net sales	8.1	6.4		9.9
Earnings per share, EUR	0.33	0.26	26.9	1.96
Investments, MEUR	7.8	9.2	-14.9	32.0
Equity per share, EUR	12.05	12.36	-2.5	12.81
Equity to total assets, %	57.1	65.0	-7.9	63.8
Gearing, %	-21.7	-3.6	18.1	-15.5

* Due to a change in the presentation of the income statement, the previous term of gross margin was replaced by gross profit.

Business development

Lasse Aho, Managing Director:

Olvi Group’s business development was good in comparison with the previous year. Sales volume, net sales and operating profit improved, with the strongest boost coming from Finland. Sales volume increased by 7.0 percent. Factors behind the growth include consumer demand focusing on retail sales, Easter sales taking place in March, as well as good development of exports. Net sales increased by slightly less than one percent. Operating profit increased by 2.7 percent. Olvi Group put a lot of effort into launching new products for the upcoming season according to plan.

Restrictions put in place due to the corona pandemic had a substantial impact on sales channels in Olvi’s market areas in the first quarter. In almost all of Olvi’s operating countries, the HoReCa sales channel was totally closed or operated partially. Cross-border and harbour sales remained at a low level. Within Olvi Group, this is reflected as a loss of sales between Estonia and Finland. However, retail sales continued on a strong track, and this compensated the other sales channels. Exports increased as well. Production facilities have operated normally. 

Business in Finland continued on a strong growth track. Sales volume, net sales and operating profit have clearly increased on the previous year. Olvi has been successful in increasing the sales volume in Finland despite the corona pandemic, thanks to its strong brands and versatile range of packaging. The demand for beer in particular has continued on a strong growth track, but an upward trend can also be seen in non-alcoholic products such as mineral waters. Olvi will increase its capacity in the water business by acquiring a spring water bottling plant and its equipment, which was agreed at the end of the quarter. Olvi increased its capacity in the water business through an agreement to acquire a spring water bottling plant and equipment, which was signed at the end of the quarter. Operating profit improved by 27.3 percent thanks to increased sales volume and production efficiency.

In Estonia, first-quarter sales volume declined by 1.6 percent due to strict restrictions associated with the corona pandemic. The restrictions impacted cross-border and harbour sales as well as the HoReCa market in particular. However, domestic retail sales improved on the previous year, and there was a continuing growth trend in exports. Operating profit in proportion to net sales remained at a high level of 12.8 percent, even though the operating profit in euros dropped by some 13 percent from the previous year.

The business in Latvia was substantially impacted by restrictions in the HoReCa segment. Overall market demand also declined in the first months of the year but upward signs were seen in March. Increased exports have replaced the drop in domestic demand to some extent. Sales volume declined by 5.6 percent in the first quarter. In addition to the drop in litres sold, the corona situation has made price competition more intense. Due to this, net sales declined by 9.4 percent and operating profit by 66.3 percent. Olvi invested in future competitive ability in Latvia by acquiring the Piebalgas Alus microbrewery. This was announced in a release on 8 March 2021. The acquisition improves Cesu Alus’s position particularly in HoReCa and premium products. According to its 2020 accounts, Piebalgas produced 2.7 million litres and made 4.2 million euro in net sales. The competition authorities have approved the acquisition, and Piebalgas will become a part of the Latvian business in the second quarter.

The sales volume and net sales in Lithuania remained almost on a par with the previous year even though HoReCa sales came to an almost total halt in the first quarter. Sales have remained profitable through the development of premium products and package sizes for beers in particular. The market position has also continued to become stronger. Operating profit developed well, showing growth of 36.1 percent.

In Belarus, business development in the first quarter was good. Sales volume increased by almost 13 percent, thanks to domestic demand as well as increased exports. Even though the country imposed no official restrictions due to the corona pandemic, HoReCa sales have dropped somewhat due to consumer behaviour. Comparable net sales declined by 5.2 percent due to the weakened exchange rate. Net sales in the local currency increased by almost 20 percent; this was achieved through a more versatile product portfolio, among other things. Operating profit in euros declined by 17.7 percent but in the local currency there was an increase of some 4 percent. 

Investments have been completed as planned during the review period. The amount of investments amounted to 7.8 million euro and was focused on improving production efficiency and capacity.

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 January-March increased by 7.0 percent to 163.9 (153.2) million litres.

Sales volume development focused on Finland and Belarus, while consumer demand in the Baltic states declined due to substantial restrictions associated with the corona pandemic.

Sales volume, million litres	1–3 / 2021	1–3 / 2020	Change %
Finland	55.2	48.1	14.7
Estonia	22.5	22.9	-1.6
Latvia	13.7	14.5	-5.6
Lithuania	25.1	25.3	-0.6
Belarus	53.4	47.3	12.8
Eliminations	-6.1	-5.0
Total	163.9	153.2	7.0

 

The Group’s net sales in January-March increased by 0.9 percent and amounted to 85.3 (84.6) million euro. Growth was focused on Finland.

Net sales, million euro	1–3 / 2021	1–3 / 2020	Change %
Finland	38.8	36.0	7.9
Estonia	14.2	14.9	-5.0
Latvia	7.0	7.7	-9.4
Lithuania	11.3	11.2	0.7
Belarus	16.3	17.2	-5.2
Eliminations	-2.2	-2.4
Total	85.3	84.6	0.9

Earnings development

The Group’s operating profit in January-March stood at 8.1 (7.8) million euro, or 9.4 (9.3) percent of net sales. In the first quarter, Finland and Lithuania in particular were able to substantially improve their operating profit in comparison to the previous year.

Operating profit, million euro	1–3 / 2021	1–3 / 2020	Change %
Finland	3.8	2.9	27.3
Estonia	1.8	2.1	-12.8
Latvia	0.2	0.5	-66.3
Lithuania	0.7	0.5	36.1
Belarus	1.7	2.1	-17.7
Eliminations	-0.1	-0.3
Total	8.1	7.8	2.7

 

The Group’s January-March profit after taxes amounted to 6.9 (5.4) million euro. The previous year’s result was hampered by exchange rate losses.

Earnings per share calculated from the profit belonging to parent company shareholders in January-March stood at 0.33 (0.26) euro per share.

Balance sheet, financing and investments

Olvi Group’s balance sheet total at the end of March 2021 was 442.4 (398.5) million euro. Equity per share at the end of March 2021 stood at 12.05 (12.36) euro. The equity ratio was 57.1 (65.0) percent and the gearing ratio was -21.7 (-3.6) percent. The current ratio, which represents the Group’s liquidity, was 1.1 (1.2). The equity ratio was affected by a change in Finnish taxation; the payment period for excise taxes is now one month later. Also, the dividend liability arising from the Annual General Meeting was now recognised in March, not in April as in the previous year. These changes increase the amount of interest-free current liabilities substantially in comparison to the previous year.

Interest-bearing liabilities amounted to 3.4 (13.5) million euro at the end of March. Current liabilities made up 1.0 (11.1) million euro of all interest-bearing liabilities. Interest-bearing liabilities consist mostly of leasing liabilities.

Olvi Group’s investments in extensions and replacements from January to March amounted to 7.8 (9.2) million euro. The companies in Finland accounted for 2.4 million euro, the Baltic subsidiaries for 3.7 million euro and Lidskoe Pivo in Belarus for 1.7 million euro of the total. Olvi Group has continued investments according to plan 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-March was 1,923 (1,871). The Group’s average number of personnel increased by 52 people or 2.8 percent.

Olvi Group’s average number of personnel by country:

	1–3 / 2021	1–3 / 2020	Change %
Finland	371	357	3.9
Estonia	324	318	1.9
Latvia	197	199	-1.0
Lithuania	244	238	2.5
Belarus	787	759	3.7
Total	1,923	1,871	2.8

 

Board of Directors and management

There have been no changes in Olvi plc’s Board of Directors or management during the review period. The Annual General Meeting was held on 31 March 2021. The decisions taken and the effects on the composition of the Board of Directors are described below.

Other events during the review period

Annual General Meeting

Olvi plc’s Annual General Meeting of 31 March 2021 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 2020.

In accordance with the Board’s proposal, the General Meeting decided that a dividend of 1.10 (1.00) euro be paid on each A and K share for the accounting period 2020. The dividend according to the resolution accounts for 56.2 (49.6) percent of Olvi Group’s consolidated 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.

The General Meeting decided that the Board of Directors shall have six (6) members. Pentti Hakkarainen, Lasse Heinonen, Nora Hortling, Elisa Markula and Päivi Paltola were re-elected to the Board of Directors. Juho Nummela was elected as a new member of the Board of Directors.

The authorised public accounting firm Ernst & Young Oy was re-elected the company’s auditor, with Elina Laitinen, Authorised Public Accountant, as auditor in charge.

All decisions made at the General Meeting can be found in the bulletin released on 31 March 2021.

Organisation of the Board of Directors

At its organising meeting held on 31 March 2021, the Board of Olvi plc elected Pentti Hakkarainen as the Chairman of the Board and Nora Hortling as the Vice Chairperson of the Board.

The Audit Committee consists of Lasse Heinonen, Nora Hortling and Juho Nummela, while Pentti Hakkarainen, Elisa Markula and Päivi Paltola are members of the Remuneration Committee.

Changes in corporate structure

There were no changes in Olvi’s holdings in subsidiaries in January-March 2021. On 8 March 2021, Olvi announced the acquisition of the entire stock of Piebalgas Alus, a microbrewery in Latvia. The company will become a subsidiary of Cesu Alus. The competition authorities approved the acquisition in April, and Piebalgas will become a part of the Latvian business in the second quarter.

Share-based payments

Olvi Group’s share-based incentive plan for key personnel, the performance period of which was from 1 February 2019 to 31 January 2021, has expired. At its meeting of 1 February 2021, the Board of Directors of Olvi plc decided on three new share-based incentive plans for the Group’s key personnel: a performance-based share plan for 2021–2025, a matching share plan for 2021–2022 and a restricted share plan for 2021–2025. Detailed information on the incentive plans and the associated share repurchases is provided in Table 5, Sections 4 and 5 of the tables attached to this interim report.

Business risks and their management

The corona pandemic still imposes uncertainty on business operations. Business development is difficult to predict as the scope and time of government-imposed restrictions to contain the corona pandemic cannot be sufficiently estimated. In addition to overall demand, such restrictions have an effect on the distribution of sales between different channels. Olvi has drafted several scenarios and made preparations for responding to changing situations through a variety of measures, for example if the crisis is prolonged.

The crisis has brought challenges in the availability of some production items such as beverage cans. There is also global upward pressure in the prices of raw materials, including packaging. However, the production materials required at Olvi are currently in good supply. Production has operated almost normally and there has not been any widespread virus exposure among personnel. Olvi has made preparations for production disruptions and drafted contingency plans concerning the availability of personnel and raw materials, among other things. In Belarus, further uncertainty is present due to potential continuation of the exchange rate downtrend; this is associated with the political and economic situation in the country.

A more detailed description of normal business-related risks is provided in the Board of Directors’ report and the notes to the financial statements, as well as in the Investors/Corporate Governance section of the company’s Web site.

Events after the review period

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

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 interim report bulletin, Table 5

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

OLVI GROUP		TABLE 1
STATEMENT OF COMPREHENSIVE INCOME
EUR 1,000
	1–3 / 2021	1–3 / 2020	1–12 / 2020
Gross sales	210,813	202,801	1,005,101
Excise taxes and other adjustments	-125,495	-118,213	-590,217
Net sales	85,318	84,588	414,884
Cost of sales	-50,655	-49,125	-236,849
Gross profit	34,663	35,463	178,035
Logistics, sales and marketing expenses	-19,660	-20,215	-87,300
Administrative expenses	-7,204	-7,615	-34,650
Other operating income and expenses	257	212	350
Operating profit	8,056	7,845	56,435
Financial income and expenses	-2	-1,527	-2,626
Share of profit in associates	0	0	2
Earnings before tax	8,054	6,318	53,811
Income taxes	-1,182	-938	-12,895
NET PROFIT FOR THE PERIOD	6,872	5,380	40,916
Other comprehensive income items that may be subsequently reclassified to profit and loss:
Translation differences related to foreign subsidiaries	1,408	-10,625	-15,588
Income taxes related to these items	-25	214	263
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD	8,255	-5,031	25,591
Distribution of profit:
- parent company shareholders	6,836	5,425	40,559
- non-controlling interests	36	-45	357
Distribution of comprehensive income:
- parent company shareholders	8,176	-4,675	25,704
- non-controlling interests	79	-356	-113
Earnings per share calculated from the profit belonging to parent company shareholders, EUR
-   undiluted	0.33	0.26	1.96
-   diluted	0.33	0.26	1.96

OLVI GROUP			TABLE 2
BALANCE SHEET
EUR 1,000	31 March 2021	31 March 2020	31 December 2020
ASSETS
Non-current assets
Tangible assets	206,515	203,465	204,156
Goodwill	25,269	25,516	25,172
Other intangible assets	9,581	10,623	9,925
Shares in associates	994	1,016	994
Other investments	851	836	851
Loans receivable and other non-current receivables	1,849	1,793	1,786
Deferred tax receivables	616	578	1,086
Total non-current assets	245,675	243,827	243,970
Current assets
Inventories	47,702	48,321	42,278
Accounts receivable and other receivables	89,585	83,049	88,234
Income tax receivable	1,298	941	773
Liquid assets	58,167	22,368	45,096
Total current assets	196,752	154,679	176,381
TOTAL ASSETS	442,427	398,506	420,351
SHAREHOLDERS’ EQUITY AND LIABILITIES
Shareholders’ equity held by parent company shareholders
Share capital	20,759	20,759	20,759
Other reserves	1,387	1,387	1,387
Treasury shares	-989	-503	-1,802
Translation differences	-57,502	-54,087	-58,842
Retained earnings	285,875	288,467	303,465
	249,530	256,023	264,967
Share belonging to non-controlling interests	3,202	2,924	3,165
Total shareholders’ equity	252,732	258,947	268,132
Non-current liabilities
Financial liabilities	2,376	2,426	2,303
Other liabilities	4,482	4,263	4,473
Deferred tax liabilities	11,244	7,783	11,107
Current liabilities
Financial liabilities	1,034	11,086	1,333
Accounts payable and other liabilities	169,969	113,864	132,522
Income tax liability	590	137	481
Total liabilities	189,695	139,559	152,219
TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES	442,427	398,506	420,351

 

OLVI GROUP							TABLE 3
CHANGES IN SHAREHOLDERS’ EQUITY
EUR 1,000	Share capital	Other reserves	Treasury shares reserve	Fair value reserve	Translation differences	Retained earnings	Share of non- controlling interests	Total
Shareholders’ equity 1 Jan 2021	20,759	1,092	-1,802	295	-58,842	303,465	3,165	268,132
Comprehensive income:
Net profit for the period						6,836	36	6,872
Other comprehensive income items:
Translation differences					1,340		43	1,383
Total comprehensive income for the period					1,340	6,836	79	8,255
Transactions with shareholders:
Payment of dividends						-22,771	-16	-22,787
Acquisition of treasury shares			-874					-874
Share-based incentives, value of work performed						63		63
Issue of treasury shares to employees			1,687			-1613		74
Adjustment to previous periods						-105	-26	-131
Total transactions with shareholders			813			-24,426	-42	-23,655
Shareholders’ equity 31 Mar 2021	20,759	1,092	-989	295	-57,502	285,875	3,202	252,732
EUR 1,000	Share capital	Other reserves	Treasury shares reserve	Fair value reserve	Translation differences	Retained earnings	Share of non- controlling interests	Total
Shareholders’ equity 1 Jan 2020	20,759	1,092	-503	295	-43,987	282,895	3,318	263,869
Comprehensive income:
Net profit for the period						5,425	-45	5,380
Other comprehensive income items:
Translation differences					-10,100		-311	-10,411
Total comprehensive income for the period					-10,100	5,425	-356	-5,031
Transactions with shareholders:
Payment of dividends							-38	-38
Share-based incentives, value of work performed						147		147
Total transactions with shareholders						147	-38	109
Shareholders’ equity 31 Mar 2020	20,759	1,092	-503	295	-54,087	288,467	2,924	258,947

 

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

OLVI GROUP		TABLE 4
CASH FLOW STATEMENT
EUR 1,000
	1–3 / 2021	1–3 / 2020	1–12 / 2020
Net profit for the period	6,872	5,380	40,916
Adjustments:
Depreciation and impairment	6,465	6,269	24,972
Other adjustments	1,065	2,815	16,327
Change in net working capital:
Change in accounts receivable and other receivables	-1,178	-15,506	-22,809
Change in inventories	-5,175	-6,893	-1,274
Change in accounts payable and other liabilities	13,934	-4,638	17,339
Interest paid	-126	-209	-588
Interest received	65	37	260
Dividends received	0	0	4
Taxes paid	-1,008	-984	-9,351
Cash flow from operations (A)	20,914	-13,729	65,796
Investments in tangible and intangible assets	-7,095	-6,904	-31,533
Capital gains on disposal of tangible and intangible assets	387	329	1,697
Acquisition of shares from non-controlling interests	0	0	-6
Expenditure on other investments	0	0	-15
Dividends received	0	0	24
Cash flow from investments (B)	-6,708	-6,575	-29,833
Withdrawals of loans	0	10,000	15,497
Repayments of loans	-355	-414	-16,917
Acquisition of treasury shares	-874	0	-1,299
Dividends paid	0	0	-20,754
Increase (-) / decrease (+) in current interest- bearing business receivables	0	0	26
Cash flow from financing (C)	-1,229	9,586	-23,447
Increase (+)/decrease (-) in liquid assets (A+B+C)	12,977	-10,718	12,516
Liquid assets 1 January	45,096	33,832	33,832
Effect of exchange rate changes	94	-746	-1,252
Liquid assets 31 Mar/31 Dec	58,167	22,368	45,096

 

OLVI GROUP                                                    TABLE 5

NOTES TO THE INTERIM REPORT

The interim report has been prepared in accordance with IAS 34, applying the same accounting policies as for the financial statements of 31 December 2020, with the exception of the presentation of the income statement. From now on, the income statement is based on the function of expenses. The comparison data has been adjusted to correspond to the new presentation.

The information in the interim report is presented in thousands of euros (EUR 1,000). 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. The information disclosed in the interim report is unaudited.

1.  SEGMENT INFORMATION
NET SALES BY SEGMENT 1–3/2021
EUR 1,000	Finland	Estonia	Latvia	Lithuania	Belarus	Elimi-nations	Group
INCOME
External sales	38,631	13,416	6,432	10,890	15,949		85,318
Beverage sales	38,414	13,416	6,432	10,890	15,949		85,101
Equipment services	217	0	0	0	0		217
Internal sales	152	741	565	402	359	-2,219	0
Total net sales	38,783	14,157	6,997	11,292	16,308	-2,219	85,318
Total net profit for the period	3,418	1,862	143	507	1,542	-600	6,872
NET SALES BY SEGMENT 1–3/2020
EUR 1,000	Finland	Estonia	Latvia	Lithuania	Belarus	Elimi-nations	Group
INCOME
External sales	35,702	14,021	7,171	10,535	17,159	0	84,588
Beverage sales	35,327	14,021	7,171	10,535	17,159	0	84,213
Equipment services	375	0	0	0	0	0	375
Internal sales	248	875	549	681	41	-2,394	0
Total net sales	35,950	14,896	7,720	11,216	17,200	-2,394	84,588
Total net profit for the period	3,334	2,142	462	317	-706	-169	5,380

 

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	1–3 / 2021	1–3 / 2020	1–12 / 2020
Managing Director	662	275	550
Chairman of the Board	18	18	74
Other members of the Board	41	41	172
Total	721	334	796

 

3. SHARES AND SHARE CAPITAL
	31 March 2021	%
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 March 2021 totalled 20,759 thousand euro.

Olvi plc’s shares will receive a dividend of 1.10 euro per share for 2020 (1.00 euro per share for 2019), totalling 22.8 (20.7) million euro. The dividend will be paid in two instalments. The first instalment of 0,55 euro per share will be paid on 20 April 2021. The second instalment of 0,55 euro per share will be paid on 3 September 2021. 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                

Olvi Group’s share-based incentive plan for key personnel, the performance period of which was from 1 February 2019 to 31 January 2021, has expired. The target group of the plan included approximately 60 people, and in accordance with the terms and conditions of the plan, rewards were paid in Olvi plc Series A shares and partially in cash. A total of 36,200 Series A shares were handed over as share-based rewards.

At its meeting of 1 February 2021, the Board of Directors of Olvi plc decided on the terms and conditions of three new share-based incentive plans for the Group’s key personnel: a performance-based share plan for 2021–2025, a matching share plan for 2021–2022 and a restricted share plan for 2021–2025. Among these incentive plans, the performance-based share plan for the performance periods 2021–2022 and 2021–2023 started on 15 February 2021. The target groups include approximately 18 people, including the Managing Director of the Group, the Managing Directors of the subsidiaries outside Finland, the members of Olvi plc’s Management Group and the Sales Directors of subsidiaries outside Finland. The rewards are based on the Group’s accumulated operating profit in euros and the increase of non-alcoholic sales volume. Net rewards payable for the performance period 2021–2022 amount to an approximate maximum of 6,100 Olvi plc Series A shares, and for the performance period 2021–2023, approximately 10,000 Olvi plc Series A shares.

The objective of long-term rewards is to support the achievement of the company’s targets, make key personnel committed to the company and offer incentive plans based on earning the company’s shares. The rewards are payable partially in Olvi plc’s Series A shares and partially in cash. The cash proportion is intended to cover taxes and tax-related costs arising from the rewards to the employees involved. As a rule, no reward will be paid if employment or service ends before the reward payment. Under the scheme, the target group is able to earn Olvi plc Series A shares based on performance. The Board of Directors shall decide on the earning criteria and the targets for each of these at the beginning of the performance period. Any rewards from the scheme shall be paid after the end of each performance period.

The Board of Directors has set an upper limit for the gross total rewards payable to each person in a calendar year. The limit applies to all gross rewards payable under long-term incentive schemes. Any member of Olvi’s Management Group has to hold at least one-half of the shares received as net rewards from the new incentive plans until the value of the member’s holding in the company equals at least one-half of their annual salary for the previous year. These Olvi plc Series A shares have to be held for as long as the person is a member of the Management Group.

In the period under review, costs associated with the plan were recognised for a total of 63.5 thousand euro. Olvi Group does not have any other share-based plans or option plans.                                           

5. TREASURY SHARES           

At the beginning of January 2021, Olvi plc held 11,549 of its own shares as treasury shares. Olvi plc continued its share repurchase plan in January. The plan started on 5 November 2020 and ended on 15 January 2021. The shares shall be acquired for the purpose of financing or executing any upcoming corporate acquisitions or other arrangements, implementing the company’s incentive schemes or for other purposes decided upon by the Board of Directors.

On 19 February 2021, the Board of Directors of Olvi plc decided to initiate a scheme of acquiring treasury shares based on the authorisation issued by the Annual General Meeting on 8 April 2020. On this basis, the Board will repurchase a maximum of 10,000 Series A shares. The repurchase of treasury shares is based on the new share-based incentive plan for the Group’s key personnel announced on 2 February 2021. The acquisition of shares started on 25 February 2021 and ended on 1 March 2021.

At the end of the review period, Olvi plc holds a total of 20,899 of its own Series A shares. The total purchase price of treasury shares was 988,962.12 euro. Treasury shares held by the company itself are ineligible for voting. Series A shares held by Olvi plc as treasury shares represent 0.10 percent of all shares and 0.02 percent of the aggregate number of votes. The treasury shares represent 0.12 percent of all Series A shares and associated votes.

On 31 March 2021, the General Meeting of Shareholders of Olvi plc decided to revoke any unused authorisations to acquire treasury shares and authorise the Board of Directors of Olvi plc to decide on the acquisition of the company’s own shares using distributable funds. The authorisation is valid for one year starting from the General Meeting and covers a maximum of 500,000 Series A shares.

The Annual General Meeting also decided to revoke all existing unused authorisations for the transfer of own shares and authorise the Board of Directors to decide on the issue of a maximum of 1,000,000 new Series A shares and the transfer of a maximum of 500,000 Series A shares held as treasury shares.         

6. NUMBER OF SHARES *)	1–3 / 2021	1–3 / 2020	1–12 / 2020
- average	20,692,394	20,710,683	20,708,331
- at end of period	20,701,333	20,710,683	20,683,672
*) Treasury shares deducted.
7. TRADING OF SERIES A SHARES ON THE HELSINKI STOCK EXCHANGE
	1–3 / 2021	1–3 / 2020	1–12 / 2020
Trading volume of Olvi A shares	536,274	446,370	1,474,892
Total trading volume, EUR 1,000	24,461	17,190	60,470
Traded shares in proportion to
all Series A shares, %	3.2	2.6	8.7
Average share price, EUR	45.63	38.53	41.03
Price on the closing date, EUR	48.70	36.60	48.50
Highest quote, EUR	49.30	42.95	50.00
Lowest quote, EUR	43.10	30.25	30.25

                                                                               

8. FOREIGN AND NOMINEE-REGISTERED HOLDINGS ON 31 March 2021
	Book entries		Votes		Shareholders
	qty	%	qty	%	qty	%
Finnish total	15,892,683	76.70	86,805,547	94.73	15,518	99.61
Foreign total	62,641	0.30	62,641	0.07	50	0.32
Nominee-registered (foreign) total	319,500	1.54	319,500	0.35	6	0.04
Nominee-registered (Finnish) total	4,447,408	21.46	4,447,408	4.85	5	0.03
Total	20,722,232	100.00	91,635,096	100.00	15,579	100.00

9. LARGEST SHAREHOLDERS ON 31 March 2021
	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	49,152	261,752	1.26	4,301,152	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		2,319,109	2,319,109	11.19	2,319,109	2.53
6. Nordea Bank Abp, nominee register		1,043,312	1,043,312	5.03	1,043,312	1.14
7. Skandinaviska Enskilda Banken Ab (publ) Helsinki branch, nominee register
		1,037,962	1,037,962	5.01	1,037,962	1.13
8. Varma Mutual Pension Insurance Company		828,075	828,075	4.00	828,075	0.90
9. Ilmarinen Mutual Pension Insurance Company		675,000	675,000	3.26	675,000	0.74
10. Hortling Pia Johanna	23,388	25,066	48,454	0.23	492,826	0.54
Others	79,812	10,003,708	10,083,520	48.66	11,599,948	12.66
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-March 2021, Olvi has not received any flagging notices in accordance with Chapter 2, Section 10 of the Securities Markets Act.

10. PROPERTY, PLANT AND EQUIPMENT
EUR 1,000
	1–3 / 2021	1–3 / 2020	1–12 / 2020
Opening balance	204,156	208,701	208,701
Additions	7,696	8,881	31,923
Deductions and transfers	-442	-404	-2,294
Depreciation	-5,878	-5,697	-22,625
Exchange rate differences	983	-8,016	-11,549
Total	206,515	203,465	204,156

 

11. CONTINGENT LIABILITIES
EUR 1,000
	31 March 2021	31 March 2020	31 December 2020
Pledges and contingent liabilities
For own commitments	1,938	1,988	1,938
Leasing and rental liabilities:
Due within one year	811	769	788
Due within 1 to 5 years	631	323	398
Due in more than 5 years	13	0	0
Leasing and rental liabilities total	1,455	1,092	1,186
Other liabilities	60	60	60

12. 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.

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).