Silvano Fashion Group Consolidated Interim Financial Report for Q3 and 9 months of 2020 (unaudited)

Silvano Fashion Group
·10-min read

Selected Financial Indicators

Summarized selected financial indicators of the Group for 9 months of 2020 compared to 9 months of 2019 and 30.09.2020 compared to 31.12.2019 were as follows:

in thousands of EUR

09m 2020

09m 2019

Change

Revenue

29 759

44 811

-33.6%

Gross Profit

18 097

22 657

-20.1%

Operating profit

8 370

10 090

-17.0%

EBITDA

11 042

12 745

-13.4%

Net profit for the period

1 198

9 764

-87.7%

Net profit attributable equity holders of the Parent company

1 000

9 292

-89.2%

Earnings per share (EUR)

0,03

0,26

-88.5%

Operating cash flow for the period

6 620

12 856

-48.5%

in thousands of EUR

30.09.2020

31.12.2019

Change

Total assets

41 593

46 309

-10.2%

Total current assets

27 936

27 123

3.0%

Total equity attributable to equity holders of the Parent company

24 186

26 324

-8.1%

Cash and cash equivalents

9 856

5 152

91.3%

Margin analysis, %

09m 2020

09m 2019

Change

Gross profit

60.8

50.6

20.2%

Operating profit

28.1

22.5

24.9%

EBITDA

37.1

28.4

30.6%

Net profit

4.0

21.8

-81.7%

Net profit attributable to equity holders of the Parent company

3.4

20.7

-83.6%

Financial ratios, %

30.09.2020

31.12.2019

Change

ROA

5.5

22.2

-75.2%

ROE

9.7

38.9

-75.1%

Price to earnings ratio (P/E)

22.8

7.3

212.3%

Current ratio

4.0

2.7

48.1%

Quick ratio

1.7

0.8

112.5%

Financial performance

The Group`s sales amounted to 29 759 thousand EUR during 9 months of 2020, representing a 33.6% decrease as compared to the same period of previous year. Overall, wholesales decreased by 34.4%, measured in EUR.

The Group’s gross profit during 9 months of 2020 amounted to 18 097 thousand EUR and decrease by 20.1% compared to previous year. The gross margin during 9 months of 2020 increased to 60.8%, from 50.6% in the respective period of previous year.

Consolidated operating profit for 9 months of 2020 amounted to 8 370 thousand EUR, compared to 10 090 thousand EUR in 9 months of 2019, decrease by 17.0%. The consolidated operating profit margin was 28.1% for 9 months of 2020 (22.5% in 9 months of 2019). Consolidated EBITDA for 9 months of 2020 decreased by 13.4% and amounted to 11 042 thousand EUR, which is 37.1% in margin terms (12 745 thousand EUR and 28.4% for 9 months of 2019).

Reported consolidated net profit attributable to equity holders of the Parent company for 9 months of 2020 amounted to 1 000 thousand EUR, compared to net profit of 9 292 thousand EUR in 9 months of 2019, net profit margin attributable to equity holders of the Parent company for 9 months of 2020 was 3.4% against 20.7% in 9 months of 2019.

Financial position

As of 30 September 2020 consolidated assets amounted to 41 593 thousand EUR representing decrease by 10.2% as compared to the position as of 31 December 2019.

Trade and other receivables decreased by 900 thousand EUR as compared to 31 December 2019 and amounted to 1 710 thousand EUR as of 30 September 2020. Inventory balance decreased 2 991 thousand EUR and amounted to 16 368 thousand EUR as of 30 September 2020.

Equity attributable to equity holders of the Parent company decreased by 2 138 thousand EUR and amounted to 24 186 thousand EUR as of 30 September 2020. Current liabilities decreased by 3 184 thousand EUR during 9 months of 2020.

Investments

During 9 months of 2020 the Group’s investments into property, plant and equipment totalled 191 thousand EUR, in previous year same period 1 143 thousand EUR. Investments were made mainly into opening and renovating own stores, as well into equipment and facilities to maintain effective production for future periods.

Personnel

As of 30 September 2020, the Group employed 1 777 employees, including 498 people in retail operations. The rest were employed in production, wholesale, administration and support operations. In 31.12.2019 there were 1 888 employees, including 503 people in retail operations.

Total salaries and related taxes during 9 months of 2020 amounted 7 407 thousand EUR (9 846 thousand EUR in 9 months of 2019). The remuneration of key management of the Group, including the key executives of all subsidiaries, totalled 556 thousand EUR.

Decisions made by governing bodies during 9 months 2020

On June 30, 2020 Silvano Fashion Group held its regular Annual General Meeting of Shareholders. The Meeting adopted the following decisions.

  • The Meeting approved the 2019 Annual Report.

  • The Meeting decided leave the net profit undistributed and include the net profit of the financial year 2019 in retained earnings.

  • The Meeting decided: To annul Article 5.7 of the Articles of Association which includes: The public limited company may be represented in all legal transactions only by two members of the Management Board jointly. To approve the new Articles of Association of the Company.

  • The Meeting decided: To recall Toomas Tool, Mart Mutso, Risto Mägi, Triin Nellis and Stephan David Balkin from the Supervisory Board of SFG. To elect Toomas Tool as member of the Supervisory Board of SFG for the next 5-year period until June 30, 2025. To elect Mari Tool as member of the Supervisory Board of SFG for the next 5-year period until June 30, 2025. To elect Risto Mägi as member of the Supervisory Board of SFG for the next 5-year period until June 30, 2025. To elect Triin Nellis as member of the Supervisory Board of SFG for the next 5-year period until June 30, 2025. To elect Stephan David Balkin as member of the Supervisory Board of SFG for the next 5-year period until June 30, 2025.

  • The Meeting decided: To appoint the auditing company Ernst & Young Baltic AS (registry code 10877299, located at Rävala 4, 10143 Tallinn) as the auditor of AS Silvano Fashion Group in 2020, 2021 and 2022 the financial years.

Consolidated Statement of Financial Position

in thousands of EUR

Note

30.09.2020

31.12.2019

ASSETS

Current assets

Cash and cash equivalents

9 856

5 152

Current loans granted

2

2

Trade and other receivables

2

1 710

2 610

Inventories

3

16 368

19 359

Total current assets

27 936

27 123

Non-current assets

Long-term receivables

235

334

Investments in associates

58

82

Available-for-sale investments

245

321

Deferred tax asset

1 511

905

Intangible assets

364

423

Investment property

648

869

Property, plant and equipment

4

10 596

16 252

Total non-current assets

13 657

19 186

TOTAL ASSETS

41 593

46 309

LIABILITIES AND EQUITY

Current liabilities

Short-term finance lease obligations

581

2 362

Trade and other payables

5

4 985

6 899

Tax liabilities

1 400

889

Total current liabilities

6 966

10 150

Non-current liabilities

Deferred tax liability

0

14

Long-term bank loans

400

0

Long-term finance lease obligations

6 405

6 333

Long-term provisions

46

61

Total non-current liabilities

6 851

6 408

Total liabilities

13 817

16 558

Equity

Share capital

6

3 600

3 600

Share premium

4 967

4 967

Statutory reserve capital

1 306

1 306

Revaluation reserve

355

355

Unrealised exchange rate differences

-18 835

-15 697

Retained earnings

32 793

31 793

Total equity attributable to equity holders of the Parent company

24 186

26 324

Non-controlling interest

3 590

3 427

Total equity

27 776

29 751

TOTAL EQUITY AND LIABILITIES

41 593

46 309

Consolidated Income Statement

in thousands of EUR

Note

3Q 2020

3Q 2019

09m 2020

09m 2019

Revenue

8

12 028

14 547

29 759

44 811

Cost of goods sold

-4 506

-7 383

-11 662

-22 154

Gross Profit

7 522

7 164

18 097

22 657

Distribution expenses

-2 161

-2 902

-6 608

-8 756

Administrative expenses

-935

-1 114

-2 868

-3 401

Other operating income

94

72

223

219

Other operating expenses

-133

-191

-474

-629

Operating profit

4 387

3 029

8 370

10 090

Currency exchange income/(expense)

-3 830

443

-6 386

2 913

Other finance income/(expenses)

-111

-147

-345

-367

Net financial income

-3 941

296

-6 731

2 546

Profit (loss) from associates using equity method

-3

3

-3

3

Profit before tax

443

3 328

1 636

12 639

Income tax expense

-115

-767

-438

-2 875

Profit for the period

328

2 561

1 198

9 764

Attributable to :

Equity holders of the Parent company

255

2 370

1 000

9 292

Non-controlling interest

73

191

198

472

Earnings per share from profit attributable to equity holders of the Parent company, both basic and diluted (EUR)

7

0,01

0,07

0,03

0,26

Consolidated Statement of Comprehensive Income

in thousands of EUR

Note

3Q 2020

3Q 2019

09m 2020

09m 2019

Profit for the period

328

2 561

1 198

9 764

Other comprehensive income (loss) that will be reclassified to profit or loss in subsequent periods

-690

325

-2 749

336

Attributable to :

Equity holders of the Parent company

-741

227

-3 138

34

Non-controlling interest

51

98

389

302

Total comprehensive income (loss) for the period

-362

2 886

-1 551

10 100

Attributable to :

Equity holders of the Parent company

-486

2 597

-2 138

9 326

Non-controlling interest

124

289

587

774

Consolidated Statement of Cash Flows

in thousands of EUR

09m 2020

09m 2019

Cash flow from operating activities

Profit for the period

1 198

9 764

Adjustments for:

Depreciation and amortization of non-current assets

2 672

2 655

Share of profit of equity accounted investees

3

-3

(Gains)/ losses on the sale of property, plant and equipment

3

23

Net finance income / costs

1 941

-2 546

Provision for inventories

2

0

Provision for long-term benefits

0

5

Income tax expense

438

2 875

Change in inventories

2 991

241

Change in trade and other receivables

769

1 211

Change in trade and other payables

-2 255

-417

Change in finance lease obligations

0

547

Income tax paid

-1 142

-1 499

Net cash from operating activities

6 620

12 856

Cash flow from investing activities

Interest received

10

9

Proceeds from disposal of property, plant and equipment

34

61

Proceeds from repayments of loans granted

0

6

Acquisition of property, plant and equipment

-191

-1 143

Acquisition of intangible assets

-83

-165

Acquisition of subsidiary net of cash acquired

-26

0

Net cash used in/from investing activities

-256

-1 232

Cash flow from financing activities

Proceeds from borrowings

400

0

Repayment of finance lease

-1 619

-1 646

Interest paid on finance lease

-367

0

Dividends paid

-424

-7 730

Reduction of share capital

0

-10 800

Net cash used in/ from financing activities

-2 010

-20 176

Increase in cash and cash equivalents

4 354

-8 552

Cash and cash equivalents at the beginning of period

5 152

13 603

Effect of exchange rate fluctuations on cash held

350

-95

Cash and cash equivalents at the end of period

9 856

4 956

Jarek Särgava
AS Silvano Fashion Group
Member of the Board
Phone: +372 6845 000
Email: info@silvanofashon.com

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