January-December 2016: A historic year characterised by strong Group profitability and a strong balance sheet
Financial highlights of January to December 2016 (year-on-year in brackets, IFRS)
- Turnover increased by 11% to EUR 944 million (851)
- EBITDA improved by 3% to EUR 123 million (119)
- EBIT declined by 4% to EUR 73 million (76)
- Profit from continuing operations increased by 32% to EUR 58 million (44)
- Net debt declined by 42% to EUR 178 million (305)
- Free cash flow improved to EUR 224 million (59)
Tomas von Rettig, President and CEO of Rettig Group:
“Rettig Group is a Finnish family held investment company that creates value for generations through active and responsible ownership. 2016 was a good and historically important year: after 119 years of ownership we divested Bore to the Dutch shipping company Spliethoff, invested in a 10.2 % stake of eQ, increased our holding in Alandia to 25.3% and increased our investment in Anchor by EUR 40 million. Supported by a strong balance sheet, we are actively reviewing opportunities to delevelop our existing portfolio companies and to invest in new core investments. During the year we also transitioned from Finnish accounting standards to IFRS.
Group profit from continuing operations was the highest of all the 2000’s thanks to continued focus on efficiency improvement. We ended the year with a very strong balance sheet thanks to a strong operational cash flow and the divestment of Bore. Net asset value of the Group improved during the year.”
Portfolio Company highlights of 2016
The 2016 operating environment of Rettig ICC and Nordkalk was impacted by modest overall growth in Europe in combination with several sluggish markets, strong demand from the construction industry and growing global political uncertainty, not least as a consequence of the expected exit of the UK from the EU. Volatile financial markets and tough competition impacted the international maritime insurance industry. The financial markets were characterised by high liquidity and elevated asset valuations.
Core Investments in 2016
During 2016 Rettig ICC improved turnover to EUR 645 (545) and EBITDA to EUR 77 (67) million thanks to the acquisition of Emmeti in 2015 and continued focus on simplification of operations. The business was affected by rising raw material costs. During the year Rettig ICC reorganised responsibilities and changed the management reporting structure to improve effectiveness.
Turnover and EBITDA of Nordkalk declined to EUR 298 (306) million and EUR 52 (57) million respectively. The decline in EBITDA was largely driven by lower turnover. The market was affected by sluggish growth and oversupply of lime in its key markets, but supported by a strong construction industry.
Tony Karlström started as new CEO of Alandia in October 2016. Consolidated net result was EUR 15 (19) million impacted by tough competition on the international maritime insurance market, a good claims-ratio, high operating costs and volatile financial markets. The dividend paid out in 2016 was EUR 12 million (8). Rettig Group’s share of Alandia is 25.3 per cent.
eQ achieved good results in 2016 supported by a good performance in all three segments: Asset Management, Corporate Finance and Investments. The Group’s profit for the financial period was EUR 13 (10) million. Rettig Group owns 10.2 per cent of eQ Plc.
Financial Investments in 2016
The Financial Investments of Rettig Group are managed through Anchor Ltd. In 2016 Rettig Group invested EUR 40 million in Anchor in addition the EUR 40 million invested in 2015. During the year Anchor co-invested with DevCo Partners in Finnish Vexve Oy. Net asset value of the investment portfolio at end of the year was EUR 57 (40) million. In addition to the investment portfolio, the eQ investment of Rettig Group is held through Anchor.
Outlook for 2017
We see some signs of modest economic growth and slightly higher demand in our main markets. Higher political uncertainty globally could impact the stability of the financial markets and demand for our products and services.
Events after the reporting period
At Rettig Group’s Annual General Meeting on 17 March 2017 Matti Kuivalainen and Timo Vättö were elected new members of the Board. Martin Granholm, Christoffer Taxell and Hans Sohlström were no longer available for re-election.
Matti Kuivalainen was also elected member of the Board of Directors of Rettig ICC b.v.
Financial calendar of 2017
Rettig Group will publish the January – March 2017 Interim Management Statement on 21 April 2017, January-June 2017 interim financial report on 10 August 2017 and January-September 2017 Interim Management Statement on 19 October 2017.
For more detailed information about the result for 2016 including the fourth quarter of 2016, please see our 2016 result presentation as well as 2016 annual report published today on our website www.rettig.fi.
For further information please contact:
Josefina Tallqvist, Director, Corporate Communication and Investor Relations
Mobile: +358 40 7455276
Rettig Group is a Finnish family held investment company that creates value for generations through active and responsible ownership. Our investements include Rettig ICC (indoor climate comfort), Nordkalk (limestone), Alandia (insurance), eQ (asset management and corporate finance) and Anchor (financial investments). Through these businesses Rettig Group is active in about 28 countries globally and employs over 4,000 people.