Oriola Corporation’s Financial Statements Release 1 January – 31 December 2022

Oriola Corporation Stock Exchange Release 16 February 2023 at 8.30 a.m.

Oriola Corporation’s Financial Statements Release 1 January – 31 December 2022

Demand continued on good level, profitability improved in 2022

Reporting information for 2021 has been restated to reflect Oriola’s operating model change announced in October 2021 and the framework merger agreement with Euroapotheca to combine the respective pharmacy businesses in Sweden, announced in February 2022. The restated information, which was published on 26 April 2022, includes the new segment structure. Continuing operations include the old business areas Pharma and Retail combined into one reportable segment, and discontinued operations consist of the Consumer segment, which includes the pharmacy operations in Sweden that were combined with Euroapotheca’s Apoteksgruppen on 3 October 2022.

October–December 2022 highlights

Continuing operations

• Invoicing decreased by 3.8% to EUR 906.9 (942.4) million. On a constant currency basis, invoicing increased by 1.1% and was EUR 953.0 million.
• Net sales decreased by 3.1% to EUR 374.2 (386.2) million. On a constant currency basis, net sales increased by 1.9% and were EUR 393.6 million.
• Adjusted EBIT was EUR 0.9 (6.6) million. On a constant currency basis, the adjusted EBIT was EUR 0.9 million.
• EBIT was EUR -9.0 (4.4) million and included adjusting items of EUR -10.0 (-2.3) million mainly related to an impairment of other tangible and intangible assets not yet available for use and which have been development in progress. On a constant currency basis, EBIT was EUR -9.3 million.
• Loss for the period totalled EUR -8.1 (3.8) million and earnings per share were EUR -0.04 (0.02).

January–December 2022 highlights

Continuing operations

• Invoicing increased by 1.7% to EUR 3,568.0 (3,506.9) million. On a constant currency basis, invoicing increased by 4.9% and was EUR 3,678.7 million.
• Net sales increased by 4.4% to EUR 1,515.5 (1,452.2) million. On a constant currency basis, net sales increased by 7.6% and were EUR 1,563.0 million.
• Adjusted EBIT was EUR 17.8 (14.9) million. On a constant currency basis, adjusted EBIT was EUR 18.1 million.
• EBIT was EUR 7.6 (10.7) million and included adjusting items of EUR -10.2 (-4.2) million mainly related to an impairment of other tangible and intangible assets not yet available for use and which have been development in progress. On a constant currency basis, EBIT was EUR 7.7 million.
• Profit for the period totalled EUR 4.8 (8.6) million and earnings per share were EUR 0.03 (0.05).
• The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.06 (0.04) per share be paid for 2022.

Key figures	2022	2021	Change	2022	2021	Change
EUR million	10-12	10-12	%	1-12	1-12	%
Continuing operations
Invoicing	906.9	942.4	-3.8	3,568.0	3,506.9	1.7
Net sales	374.2	386.2	-3.1	1,515.5	1,452.2	4.4
Adjusted EBIT1	0.9	6.6	-85.7	17.8	14.9	19.1
EBIT	-9.0	4.4	-307.1	7.6	10.7	-29.0
Adjusted EBIT %	0.3	1.7		1.2	1.0
EBIT %	-2.4	1.1		0.5	0.7
Profit (loss) for the period	-8.1	3.8	-311.5	4.8	8.6	-44.9
Earnings per share, EUR, continuing operations	-0.04	0.02	-311.5	0.03	0.05	-44.9
Earnings per share, EUR, discontinued operations	-0.16	0.01		-0.04	0.01
Net cash flow from operating activities2	36.1	42.2		77.9	40.0
Gearing, % 2				-10.5	46.5
Equity ratio, % 2				23.8	20.1
Return on capital employed (ROCE), % 2				1.9	4.6

 

1 Adjusting items are specified in note Adjusting items.

2 Year 2021 includes discontinued operations.

 

In order to reflect the underlying business performance and to enhance comparability between financial periods, Oriola discloses certain performance measures of historical performance, financial position and cash flows, as permitted in the “Alternative performance measures” guidance issued by the European Securities and Markets Authority (ESMA). These measures should not be considered as a substitute for measures of performance in accordance with the IFRS. The calculation methods of these measures are provided in note Alternative performance measures in the notes to this Financial Statements Release.

 

 

Outlook for 2023

Oriola expects the adjusted EBIT, excluding the contribution from the joint venture Swedish Pharmacy Holding AB, to remain on the same level compared to 2022.

The outlook takes into consideration the significant negative impact on Oriola’s profitability from the loss of public tenders and consequently of patients in the dose dispensing business in Sweden. The dose dispensing business in Sweden will focus on new customer segments to develop the business. Furthermore, the recent overall inflationary environment and related cost pressures may have an impact on Oriola’s profitability.

The adjusted EBIT in 2022 was EUR 19.7 million, excluding the contribution from the joint venture company Swedish Pharmacy Holding AB.

CEO Katarina Gabrielson:

“The year 2022 proved Oriola’s capability to adapt to the changing market environment, as we successfully implemented our short-term turnaround plan and initiated a transformation in the company’s future direction. This was made possible by the strong support from our employees.

In 2022, Oriola’s adjusted EBIT in continuing operations increased by 32% to EUR 19.7 million, excluding the contribution from the joint venture company Swedish Pharmacy Holding AB. The improvement was driven by strict focus on increased efficiency and rigorous cost saving actions related to our turnaround initiatives as well as good market demand. The balance sheet strengthened, partly because of the combination of the pharmacy businesses of Kronans Apotek and Apoteksgruppen. In addition, we had strong cash flow driven by good underlying business performance. This gives us financial strength for developing the company further.

Despite good market demand and a strict focus on lowering our costs, Oriola’s financial performance, however, weakened in the fourth quarter of 2022 compared to the tough comparison figure. The severe inflationary environment continued, increasing transportation related costs, which are reflected in our result. In addition, our performance was burdened by the reduction of patients in the dose dispensing business in Sweden. We also booked adjusting items of EUR -10.0 million mainly related to an impairment of other tangible and intangible assets not yet available for use and which have been development in progress, and this was reflected in our earnings per share. 

The combination of the pharmacy businesses in Sweden to Swedish Pharmacy Holding AB, completed in October, was a major milestone for Oriola. The transaction strengthened our focus as a service provider to pharmaceutical companies and pharmacies as well as simplified our structure.

During the year 2022, we also progressed in improving our efficiency, portfolio management and product pricing. The impact of these actions was clearly visible in our performance, and this will support us in mitigating the inflation pressures going forward.

Oriola’s new operating model, which captures the full value of our cross-market responsibilities, has been implemented and allows us to further improve our operational, commercial and supply chain excellence. I am very pleased that our new management team is complete and is now working to create value to all our stakeholders. 

Looking ahead, our focus will be on the longer-term transformation of Oriola, aiming at creating an even more agile, efficient and profitable company. This will reinforce our role as a preferred partner in securing the availability of pharmaceuticals and in providing advisory services to pharmaceutical companies. The past twelve months have convinced me that we are on the right path and given me confidence in our ability to reach our targets in 2023.

To conclude, I would like to thank all our employees for their commitment and our customers for the good cooperation during this eventful year in a somewhat challenging environment, as well as the Board of Directors for their support throughout the year.”

Disclosure procedure

This stock exchange release is a summary of Oriola Corporation’s Financial Statements Release January–December 2022. The complete report is attached to this release in pdf format and is also available on Oriola’s website at www.oriola.com.

Analyst and investor meeting

Oriola Corporation will organise a live-webcast meeting for investors, analysts and the press on Thursday, 16 February 2023 at 10.00 a.m. The event can be followed as a live-webcast accessible through this link: https://oriola.videosync.fi/financial-statements-2022.

Publication of the Financial Statements

Oriola Corporation will publish its 2022 Financial Statements by 27 February 2023.

Further information:

Timo Leinonen
CFO
email: [email protected]

Mikael Wegmüller
VP, Communications and Sustainability
email: [email protected]

Distribution:
Nasdaq Helsinki Ltd
Key media

Released by:
Oriola Corporation
Corporate Communications
Orionintie 5
FI-02200 Espoo
www.oriola.com