BALTIKA’S UNAUDITED FINANCIAL RESULTS, SECOND QUARTER AND 6 MONTHS OF 2022
18 July 2022 - 10:00PM
BALTIKA’S UNAUDITED FINANCIAL RESULTS, SECOND QUARTER AND 6 MONTHS
OF 2022
Baltika Group ended the second quarter with a
net loss of 1,001 thousand euros. Last year, the Group ended the
second quarter with a net profit of 37 thousand euros. Compared to
the same period last year, the Group’s result weakened by 1,038
thousand euros.
The sales revenue of the Group in the second
quarter was 2,308 thousand euros, decreasing by 28% compared to the
same period last year. The reason for the decrease in sales revenue
were as follows:
- The unpredictable war situation between Russia and Ukraine
negatively affected the Group’s sales revenue. Although the
situation in the Baltics had improved by the end of the first
quarter and the number of visitors was gradually recovering, the
impact of the war on consumer behaviour was also felt during the
beginning of the second quarter.
- The Group has continued with the plan to close unprofitable
stores. Within six months, we have closed six unprofitable stores
(5 stores in the first quarter and 1 store in the second quarter).
In the case of Estonia, as the market with the largest number of
stores, the planned closure of unprofitable stores will continue
during 2022. The closing of unprofitable stores is planned to be
finalised by the end of 2022. The reduced sales revenue will be
compensated by the three new Ivo Nikkolo concept stores opened this
year.
- The sales revenue of the second quarter of last year included
the sales revenue of the discontinued brands Monton, Mosaic,
Baltman and Bastion. The sales result for the second quarter of
this year includes only minimal income from the sale of
discontinued brands.
E-com sales revenue for the second quarter was
171 thousand euros, decreasing by 56% compared to the same period
last year. The result of the e-store in the second quarter of 2021
is not fully comparable, because in the comparable period the Group
had two e-stores, Monton and Ivo Nikkolo, therefore the result of
the e-store in the second quarter of last year included the sale of
discounted products of the discontinued brands Baltman and Monton
through the Monton e-store shop. The Monton e-shop was finally
closed in September 2021.
The gross profit for the second quarter was
1,188 thousand euros, decreasing by 28% compared to the same period
last year (Q2 2021: 1,656 thousand euros). The Group’s gross
profit margin was 51% in the second quarter, i.e., at a similar
level to the same period last year (Q2 2021: 52%).
The distribution and administrative expenses of
the Group were 2,074 thousand euros in the second quarter,
remaining at a similar level to the same period last year (Q2 2021:
2,036 thousand euros). The result of the comparable period is not
fully comparable because:
- Payroll costs for the second quarter of last year include cost
reductions due to the government’s decision to support people and
businesses in sectors affected by the COVID-19 restrictions.
- In the second quarter of the previous year, a reduction of
rental cost in the amount of 266 thousand euros was recorded, as
the rental discounts received from shopping centres and government
subsidies for the rent paid were recorded.
Therefore, although the Group’s distribution and
administrative expenses have remained at a similar level to the
same period of last year, the Group has continued general cost
savings and closing unprofitable stores. In addition to the above,
the Group’s general administrative expenses have decreased by 69
thousand euros compared to the same period last year.
The Group ended the quarter with cash and cash
equivalents of 406 thousand euros, using the bank’s overdraft
facility in the amount of 2,871 thousand euros (out of the limit of
3,000 thousand euros) at the end of the quarter. Baltika continues
to implement its strategy:
- We develop modern, high-quality products in our women’s fashion
brand Ivo Nikkolo, which is available in Estonia, Latvia and
Lithuania and in our e-store.
- We are developing a newer, more modern and customer-friendly
Ivo Nikkolo e-shop.
- We continue to open new Ivo Nikkolo concept stores in the
Baltics.
Consolidated statement of financial
position
|
30 June 2022 |
31 Dec 2021 |
ASSETS |
|
|
Current
assets |
|
|
Cash and cash
equivalents |
406 |
614 |
Trade and other
receivables |
197 |
696 |
Inventories |
2,044 |
2,491 |
Total
current assets |
2,647 |
3,801 |
Non-current assets |
|
|
Deferred income
tax asset |
80 |
80 |
Other
non-current assets |
162 |
172 |
Property, plant
and equipment |
1,303 |
855 |
Right-of-use
assets |
5,548 |
5,956 |
Intangible
assets |
616 |
631 |
Total
non-current assets |
7,709 |
7,694 |
TOTAL
ASSETS |
10,356 |
11,495 |
|
|
|
LIABILITIES AND EQUITY |
|
|
Current
liabilities |
|
|
Borrowings |
356 |
364 |
Lease
liabilities |
1,834 |
1,692 |
Trade and other
payables |
2,378 |
2,438 |
Total
current liabilities |
4,568 |
4,494 |
Non-current liabilities |
|
|
Borrowings |
4,120 |
2,425 |
Lease
liabilities |
3,703 |
4,264 |
Total
non-current liabilities |
7,823 |
6,689 |
TOTAL
LIABILITIES |
12,391 |
11,183 |
|
|
|
EQUITY |
|
|
Share capital at
par value |
5,408 |
5,408 |
Reserves |
4,431 |
4,431 |
Retained
earnings |
-9,527 |
-6,627 |
Net profit
(loss) for the period |
-2,347 |
-2,900 |
TOTAL
EQUITY |
-2,035 |
312 |
TOTAL
LIABILITIES AND EQUITY |
10,356 |
11,495 |
Consolidated statement of profit and loss and
comprehensive income
|
2Q 2022 |
2Q 2021 |
6m 2022 |
6m 2021 |
|
|
|
|
|
|
|
|
|
|
Revenue |
2,308 |
3,208 |
4,383 |
5,339 |
Cost of goods
sold |
-1,120 |
-1,552 |
-2,346 |
-2,811 |
Gross
profit |
1,188 |
1,656 |
2,037 |
2,528 |
|
|
|
|
|
Distribution
costs |
-1,803 |
-1,696 |
-3,634 |
-3,837 |
Administrative
and general expenses |
-271 |
-340 |
-633 |
-835 |
Other operating
income (-expense) |
-34 |
451 |
48 |
685 |
Operating
profit (loss) |
-920 |
71 |
-2,182 |
-1,459 |
|
|
|
|
|
Finance
costs |
-81 |
-34 |
-165 |
-159 |
Profit
(loss) before income tax |
-1,001 |
37 |
-2,347 |
-1,618 |
|
|
|
|
|
Income tax
expense |
0 |
0 |
0 |
0 |
|
|
|
|
|
Net
profit (loss) for the period |
-1,001 |
37 |
-2,347 |
-1,618 |
|
|
|
|
|
Total
comprehensive income (loss) for the
period |
-1,001 |
37 |
-2,347 |
-1,618 |
|
|
|
|
|
|
|
|
|
|
Basic earnings
per share from net profit (loss) for the period, EUR |
-0,02 |
-0,03 |
-0,04 |
-0,01 |
|
|
|
|
|
Diluted earnings
per share from net profit (loss) for the period, EUR |
-0,02 |
-0,03 |
-0,04 |
-0,01 |
Brigitta Kippak
Member of the Management Board, CEO
brigitta.kippak@baltikagroup.com
- Baltika_Interim_Report_2Q 2022
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