Wulff-Yhtiöt Oyj — Earnings Release 2020

Feb 22, 2021

Wulff Group Plc’s Financial Statements Release January 1–December 31, 2020

Wulff Group Plc’s Financial Statements Release January 1–December 31, 2020

FINANCIAL STATEMENTS RELEASE 22.2.2021 at 10 A.M.

This is a summary of Wulff Group Plc’s Financial Statements Release January
1–December 31, 2020. The complete report is attached to this stock exchange
release as a pdf-file. The report is also available at the website www.wulff.fi.
Excellent result from the sales company and a proposal for a growing dividend

1.10.–31.12.2020 BRIEFLY

· Net sales totalled EUR 15.3 million (15.1), increased by 1.5%
· EBITDA and comparable EBITDA were EUR 1.5 million (1.1), 10.0% of net sales
(7.6)
· Operating profit (EBIT) and comparable operating profit (EBIT) were EUR 1.2
million (0.8)
· Earnings per share and comparable earnings per share (EPS) were EUR 0.14
(0.09)

1.1.–31.12.2020 BRIEFLY

· Net sales totalled EUR 57.5 million (56.3), increased by 2.1% (0.8)
· EBITDA was EUR 5.2 million (3.1), 9.0% of net sales (5.4) and comparable
EBITDA was EUR 5.2 million (3.2), 9.0% of net sales (5.7)
· Operating profit (EBIT) was EUR 3.5 million (1.6) and comparable operating
profit (EBIT) was EUR 3.5 million (1.7). Comparable operating profit (EBIT) grew
109.9% (11.9)
· Earnings per share (EPS) were EUR 0.32 (0.15) and comparable earnings per
share were EUR 0.32 (0.17)
· Equity-to-assets ratio was 41.9 % (39.2)
· The Board proposes to the Annual General Meeting to be held on April 8, 2021
that a dividend of EUR 0.12 per share to be paid
· Wulff estimates that the net sales will grow from 2020 (EUR 57.5 million)
and the comparable operating profit of 2021 will remain at a good level in 2021.

WULFF GROUP PLC’S CEO ELINA PIENIMÄKI

“Year 2020 was one of the most special – and finest – in Wulff’s 130-year
history. We managed to grow profitably and make an excellent result in 2020. In
the exceptional circumstances, the nature of the culture and sales community
built with over 100 years of work, was tested. I am very grateful and
appreciatitive of our personnel, customers, and partners. The market and
operational environment changed rapidly. We adapted, anticipated, and acted and
trusted our strategy to make the world a better place, one workplace at a time.
Our customers trusted that we are the right partner to ensure safe work
environments and take care of proficient workplace product service, even in
exceptional circumstances. The quality of both the customer and employee
experience developed positively in 2020: Wulff was rated the best in its field
according to an external independent survey conducted in September-October 2020,
and the Group's personnel survey said that satisfaction with Wulff as an
employer was increased. We have updated our strategy to be even more responsible
according to our customers’ and personnels’ wishes. As a responsible, local, and
multi-channel company we are a suitable partner by bouth our values and service
methods to a continuously increasing number of companies. When this is combined
with the best sales expertise in Nordic countries, and an active new customer
acquisition, and international network of partners, growth is possible even in
demanding times.”

GROUP’S NET SALES AND RESULT PERFORMANCE

In January-December 2020 net sales totalled EUR 57.5 million (56.3), and EUR
15.3 (15.1) million in the final quarter. Net sales increased by 2.1% (0.8)
during the whole financial year and 1.5% (1.7) in the final quarter. Due to the
development of the product portfolio and the sales of hygiene, cleaning and
protective products nets sales increased during the whole financial year and in
the final quarter even though due to restrictions on traveling and gathering
international fair events were mostly cancelled or postponed and the sales of
printing solutions decreased.

In January-December 2020 the gross margin amounted to EUR 20.7 million (19.8)
being 36.1% (35.2), and EUR 5.3 million (5.5) in the final quarter being 34.9%
(36.3). Sales of hygiene, cleaning, and protective products as well as IT and
remote workplace products to current and new customers increased the gross
margin for the whole financial year and the final quarter. The gross margin for
the final quarter decreased from comparison period due to cancelled fair events.
The gross margin for the final quarter was affected by changes in market price
and demand in hygiene, cleaning, and protective products. Due to the market
change, a write-down provision of EUR 0.4 million was made for slow-moving
products, of which EUR 0.2 million was accounted for in the result in the last
quarter of the year.

In January-December 2020 employee benefit expenses amounted to EUR 11.6 million
(11.9), 20.1% (21.2) of net sales and EUR 2.8 million (3.2), 18.3% (20.9) of net
sales in the fourth quarter. In the exceptional circumstances the operations
were adjusted by temporarily laying off personnel in the operations, where the
coronavirus situation affected due to restriction on traveling and gathering,
diminishing the demand a lot. This decreased the Group’s salary expenses by more
than EUR 1.0 million during the whole financial year of which EUR 0.8 million
were actualized during the second quarter. All segments focused on selling
hygiene, protective and cleaning products. The Group´s Expertise Sales segment
grew rapidly, which increased the salary expenses for the whole financial year.
The Contract Customers segment and its back-office operations were reorganized
and streamlined. There were fewer employees than in the comparison period. Due
to reorganization and continued lay offs in the fair services personnel costs
decreased in the final quarter.

Other operating expenses were to EUR 4.6 million (5.0) in January-December 2020
being 8.0% (9.0) of net sales and respectively EUR 1.4 million (1.2) in the
fourth quarter, being 9.3% (8.2) of net sales. other operating expenses
decreased for the whole financial year among other things, due to less travel.
Because of the continued restrictions the credit loss provision was increased by
EUR 0.1 million for possibly increasing bankruptcy proceedings. Wulff is
constantly developing its operations to be more sustainable and cost-efficient.
That is why the company has, for example, invested in energy production with its
own solar system at its premises in Kilo, Espoo.

There were no items affecting the comparability in the reporting period 2020. In
September 2019 Wulff moved to its own premises in Kilo, Espoo, Finland. The
relocation arrangements resulted in additional operating expenses of EUR 0.1
million and employee costs of EUR 0.1 million. The relocation arrangements have
presented as items affecting comparability in 2019, which impact has been
recognised in EBITDA, operating profit (EBIT) and earnings per share (EPS).

In January-December 2020 EBITDA amounted to EUR 5.2 million (3.1), being 9.0%
(5.4) of net sales, and EUR 1.5 million (1.1) in the fourth quarter, being 10.0%
(7.6) of net sales.

The operating profit (EBIT) amounted to EUR 3.5 million (1.6), being 6.2% (2.8)
of net sales and respectively EUR 1.2 million (0.8), 7.5% (5.1) in the fourth
quarter. The comparable operating profit (EBIT) for the whole year amounted to
EUR 3.5 million (1.7), being 6.2% (3.0) of net sales. Comparable operating
profit (EBIT) grew 109.9% (11.9) in January-December 2020.

In January-December 2020 the financial income and expenses totalled (net) EUR
-0.4 million (-0.4) including interest expenses of EUR -0.2 million (-0.2) and
mainly currency-related other financial items and bank expenses (net) EUR -0.2
million (-0.2). In the fourth quarter, the financial income and expenses (net)
totalled EUR 0.1 million (-0.1) due to valuation of financial items.

In January-December 2020 the result before taxes was EUR 3.1 million (1.2), and
EUR 1.2 million (0.7) in the fourth quarter. The comparable result before taxes
for the financial year was EUR 3.1 million (1.3).

The net profit was EUR 2.5 million (1.0) in January-December 2020 and in the
fourth quarter EUR 1.0 million (0.6). The comparable result was EUR 2.5 million
(1.2) in January-December 2020.

Earnings per share (EPS) were EUR 0.32 (0.15) in January-December 2020, and EUR
0.14 (0.09) in the fourth quarter. Comparable earnings per share (EPS) were EUR
0.32 (0.17) in January-December 2020.

KEY FIGURES

                                          IV     IV       I-IV       I-IV

EUR 1000 2020 2019 2020 2019
Net sales 15 15 57 541 56 344
341 081
Change in net sales, % 1.5% 1.7% 2.1% 0.8%
Gross profit 5 345 5 477 20 748 19 825
Gross profit, % 34.9% 36.3% 36.1% 35.2%
EBITDA 1 528 1 148 5 204 3 067
EBITDA margin, % 10.0% 7.6% 9.0% 5.4%
Operating profit/loss 1 150 763 3 541 1 570
Operating profit/loss margin, % 7.5% 5.1% 6.2% 2.8%
Profit/Loss before taxes 1 201 703 3 101 1 194
Profit/Loss before taxes margin, % 7.8% 4.7% 5.4% 2.1%
Net profit/loss for the period 914 605 2 174 1 039
attributable to equityholders of the
parent company
Net profit/loss for the period, % 6.0% 4.0% 3.8% 1.8%
Earnings per share, EUR (diluted = non 0.14 0.09 0.32 0.15
-diluted)
Return on equity (ROE), % 7.0% 4.9% 19.1% 8.5%
Return on investment (ROI), % 5.7% 4.5% 15.2% 7.9%
Equity-to-assets ratio at the end of 41.9% 39.2% 41.9% 39.2%
period, %
Debt-to-equity ratio at the end of period 57.3% 66.2% 57.3% 66.2%
Equity per share at the end of period, 2.00 1.76 2.00 1.76
EUR *
Investments in non-current assets 331 290 719 7 359
Investments in non-current assets, % of 2.2% 1.9% 1.2% 13.1%
net sales
Treasury shares held by the Group at the 144 79 144 260 79 000
end ofperiod 260 000
Treasury shares, % of total share capital 2.1% 1.1% 2.1% 1.1%
and votes
Average number of outstanding shares 6 763 6 828 6 791 043 6 828 628
368 628
Number of total issued shares at the end 6 907 6 907 6 907 628 6 907 628
of period 628 628
Personnel on average during the period 180 200 189 198
Personnel at the end of period 176 200 176 200

* Equity attributable to the equity holders of the parent company / Number of
shares excluding the acquired own shares

RISKS AND UNCERTAINTIES IN THE NEAR FUTURE

General economic and market developments as well as the employment rate have a
significant impact on the demand for workplace products and services. The
general uncertainty in the global economy also impacts Wulff's operations. The
effects of the coronavirus pandemic, its preparedness and the constraints
associated with virus management have a broad impact on the needs of both the
global and local economy and customers. In addition, megatrends in the global
economy, such as digitalisation and responsibility, are affecting market change.
There are both risks and opportunities involved in developing a range of
products and services in line with changing markets and needs. Typical business
risks include the successful implementation of Wulff's strategy and operational
risks arising from the personnel, logistics and IT environment. Intense
competition in the workplace products and services industry can affect the
profitability of the business. Changes in exchange rates affect the Group's net
result and balance sheet, as approximately half of the Wulff Group's net sales
come from non-euro countries.

SUBSEQUENT EVENTS

The Group has not had any significant subsequent events after the reporting
period.

BOARD OF DIRECTORS’ PROPOSAL FOR THE ANNUAL RESULT

The Group’s parent company Wulff Group Plc’s distributable funds totalled EUR
1.4 million (1.6). The Group’s net result attributable to the parent company
shareholders was EUR 2.2 million (1.0), i.e. EUR 0.32 per share (0.15). The
Board of Directors proposes to the Annual General Meeting to be held on April 8,
2021 that a dividend of EUR 0.12 per share, i.e. EUR 0.8 million, be paid for
the financial year 2020, and the remaining distributable funds be left in
retained earnings in the shareholders’ equity.

MARKET SITUATION AND FUTURE OUTLOOK

Megatrends play a role in Wulff’s operations. The company's operating
environment is positively affected by the growing share of information work in
all work performed. On the other hand, demographic developments are actively
reducing the number of people in employment at present. The integration of
technology into products and services is an opportunity for Wulff.
Digitalisation already brings new ways for a multi-channel company to reach and
serve customers and streamline its own operations. Of the megatrends, the most
significant for Wulff's operations and future is responsible operations and, in
particular, consideration for the environment: whether it treats the environment
as a resource or whether the goal is to improve the state of the environment.
Future success is strongly built on these themes and their growing importance in
business and consumer decision-making. Wulff has chosen responsibility and
especially positive climate action and increasing equality as important elements
of his strategy.

Demand for products is significantly affected by general economic and market
developments as well as the employment rate. In recent years, the market for
workplace products and services in the Nordic countries has remained stable.
Teleworking has increased and increased the number of workstations and the
demand for products needed in workstations. The coronavirus pandemic increased
demand for hygiene, protection, and cleaning products. Wulff estimates that the
overall market for workplace products and services will remain stable in 2021:
although the coronavirus pandemic has had a negative impact on the general
economy and employment, the company expects demand for hygiene, cleaning,
security, and IT supplies to continue to grow slightly, as at the same time
 demand for office supplies is decreasing.

Consolidation of the market for workplace products and services is expected to
continue, and Wulff is well placed to be a more competitive player in M&A.

Demand for Wulff Entre's services, which provides planning and project
management for international trade fairs, has declined due to the coronavirus
pandemic, which will weaken Wulff's net sales and operating profit in 2021.

Changes in the operating environment weaken the predictability of the whole
year. Wulff estimates that the comparable operating profit of 2021 will decrease
from 2020 but will be at a good level in 2021. Wulff's medium-term financial
targets remain unchanged. Wulff targets in the medium-term an average annual
growth of 5-10% of the netsales, a growing comparable operating profit per cent
and an increasing dividend per share.

WULFF GROUP PLC’S FINANCIAL REPORTING AND ANNUAL GENERAL MEETING 2021

Wulff Group Plc will release the following financial reports in 2021:

Annual Report 2020                                         Wednesday March 10,
2021
Interim Report January-March 2021                Monday April 26, 2021
Half-Year Report January-June 2021              Monday July 26, 2021
Interim Report January-September 2021        Monday October 25, 2021

Wulff Group Plc’s Annual General Meeting will be held on Thursday April 8, 2021.
A separate notice to the Annual General Meeting will be published prior to the
meeting.

In Espoo on February 22, 2021

WULFF GROUP PLC

BOARD OF DIRECTORS

Further information:

CEO Elina Pienimäki

tel. +358 40 647 1444

e-mail: elina.pienimaki@wulff.fi

DISTRIBUTION

NASDAQ OMX Helsinki Oy

Key media

www.wulff.fi/en

A better world – one workplace at a time. Wulff’s goal is a perfect workday! We
enable better working environments and create workplaces, wherever you are. More
comfortable, healthier, safer, more enjoyable, more active and more diverse? How
do you want to better you workday and working environment? Wulff has the
solution. We offer our customers office supplies, facility management products,
catering solutions, IT supplies, ergonomics, first aid, air purifiers, and
innovative products for worksites. Customers can also acquire international
exhibition services from Wulff. In addition to Finland, Wulff operates in
Sweden, Norway, and Denmark. Check out our products and services at wulff.fi/en.

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