TRAINERS’ HOUSE GROUP INTERIM REPORT 1 JANUARY – 31 MARCH 2022
TRAINERS' HOUSE GROUP, STOCK EXCHANGE RELEASE, 28 APRIL 2022 at
8:30
Trainers’ House: good profitability and excellent customer
activity. January-March 2022 in brief
- net sales EUR 2.7 million (EUR 2.8 million), change of -2.7 %
compared to the corresponding period of the previous year
- operating profit EUR 0.4 million (EUR 0.6 million), 13.4 % of
net sales (20.2 %)
- operating result EUR 0.4 million (EUR 0.6 million), 13.4 % of
net sales (20.2 %)
- cash flow from operations EUR 0.3 million (EUR 0.3
million)
- earnings per share EUR 0.02 (EUR 0.03)
*Number of shares changed after the review period. Figures in
the release reported according to the number of shares on 31 March
2022.
Key figures at the end of the first quarter of 2022
- cash and cash equivalents EUR 3.5 million (EUR 3.4
million)
- interest-bearing liabilities of EUR 0.6 million (EUR 1.0
million) and interest-bearing net debt of EUR -2.9 million (EUR
-2.4 million).
- equity ratio 54.7 % (69.5 %)
OUTLOOK FOR 2022
The company estimates that the operating result for 2022 will be
EUR 1.0-1.5 million.
CEO ARTO HEIMONEN
Uncertainty in the operational environment increased in the
early part of the year following Russia's invasion into Ukraine.
Despite this, customers bought the company's services as much as a
year earlier.
The work of creating a market for the customers of the
subsidiary Ignis Oy became more efficient. Business decision makers
are keen on accepting meetings.
Trainers’ House continued reforming its business model. The
company commercialized products that deliver continuous customer
value and billing, such as Growth Academy and Lean Leadership –
education, progression, and physical training. In addition, the
company began testing solutions leveraged with customer financing
during the review period. The company also continued recruiting in
accordance with its business model.
As compensation for the risk of the owners, the company decided
to pay a total dividend of EUR 1.5 million in two installments in
2022 in accordance with its dividend policy. The first dividend of
EUR 0.60 per share was paid in April.
Healthy cash flow and profitability will remain as the most
important business goals also in 2022. The company will continue to
strengthen its Ignis business and increasing the flow efficiency of
its training operations. In the media business, the company is
looking for breakthroughs.
Customer activity and the personnel’s morale were at a high
level. A warm thank you. More information: Arto Heimonen, CEO, +358
404 123 456 Saku Keskitalo, CFO, +358 404 111 111
OPERATIONAL REVIEW The business impact of the Covid 19-pandemic
decreased during the review period compared to the previous year.
In the new normal situation, the majority of customer meetings are
still carried out remotely.
Due to the Covid 19-pandemic, the Annual General Meeting was
held on 30 March 2022 with exceptional arrangements. In accordance
with the proposal of the Board of Directors, the Annual General
Meeting decided to cut the number of shares in the company to one
tenth of the previous number and to carry out a directed share
issue to avoid a fraction of the shares. In addition, in accordance
with the proposal of the Board of Directors, the Annual General
Meeting decided that the company will pay a dividend of EUR 0.70
for each share in the company after the merger described above. The
dividend will be paid in two installments, with EUR 0.60 to be paid
on 14 April 2022 (record date for dividend payment on 7 April 2022)
and EUR 0.10 to be paid on 22 December 2022 (record date for
dividend payment on 15 December 2022). The Annual General Meeting
confirmed the number of Board members as four. Aarne Aktan, Jarmo
Hyökyvaara, Jari Sarasvuo and Elma Palsila were elected as members.
At the inaugural meeting held after the Annual General Meeting, the
Board elected Jari Sarasvuo as its Chairperson. FINANCIAL
PERFORMANCE Net sales for the reporting period were EUR 2.7 million
(EUR 2.8 million). Operating profit was EUR 0.4 million, 13.5 % of
net sales (EUR 0.6 million, 20.2 %). The result for the period was
EUR 0.4 million, 13.3 % of net sales (EUR 0.6 million, 20.1 %).
The breakdown of the Group's figures (unit thousand euros) is
presented in the following table:
Group’s main figures kEUR |
1-3/2022 |
1-3/2021 |
Net sales |
2 687 |
2 762 |
Other operating income |
6 |
0 |
Personnel-related expenses |
-1 580 |
-1 382 |
Other expenses |
-638 |
-692 |
EBITDA |
475 |
688 |
Depreciation and impairment losses |
-114 |
-129 |
EBIT |
361 |
559 |
EBIT % of net sales |
13.4 % |
20.2 % |
Financial income and expenses |
-4 |
-7 |
Profit before taxes |
358 |
553 |
Income taxes |
1 |
3 |
Profit for the period |
358 |
556 |
Kauden tulos % of net sales |
13.3 % |
20.1 % |
LONG-TERM OBJECTIVES
The company's long-term goal is profitable growth. FINANCING,
INVESTMENTS AND SOLVENCY Cash flow and key financing figures (unit
million euros)
Cash flow and key financing figures mEUR |
1-3/2022 |
1-3/2021 |
Cash flow from operations before financial items |
0.3 |
0.3 |
Cash flow from operations after financial items |
0.3 |
0.3 |
Cash flow from investments |
0.0 |
-0.1 |
Cash flow from financing |
-0.1 |
-0.1 |
Total cash flow |
0.1 |
0.1 |
|
|
|
|
3/2022 |
3/2021 |
Cash |
3.5 |
3.4 |
Interest-bearing debt |
0.6 |
1.0 |
Equity ratio % |
54.7 % |
69.5 % |
MAJOR RISKS AND UNCERTAINTIES Trainers’ House’s business is
sensitive to economic fluctuations. The general economic situation
involves significant risks internationally and in Finland. The
evolution of the Covid 19-pandemic and its impact on economic
activity remains uncertain. The tense world political situation can
cause rapid changes in the operating environment. Rising inflation
could lead to a faster-than-expected tightening of monetary policy.
The overheating of the labor market makes it difficult to recruit
and retain key personnel. When the above risks materialize alone or
together, they significantly affect the company’s operations.
Changes in Europe’s openness, freedom in world trade, and the world
political situation affect the exports of Finnish companies, which
is reflected in domestic demand. This is reflected in the number of
assignments of Trainers’ House. The company divides the risk
factors affecting business, earnings, and market capitalization
into five main categories: market and business risks,
personnel-related risks, technology and information security risks,
financial risks, and legal risks. Trainers’ House has sought to
hedge against the adverse effects of other risks with comprehensive
insurance policies. These include statutory insurance, liability
and property insurance and legal expenses insurance. Insurance
coverage, insurance values and deductibles are reviewed annually
together with the insurance company. The Management Team reports to
the Board on a monthly basis on key business-related risks and,
where necessary, risk management measures. The Group has the
reporting systems required for effective business monitoring.
Internal control is linked to the company’s vision, strategic goals
and the business goals set on the basis of them. The realization of
business objectives and the Group’s financial development are
monitored on a monthly basis through the Group’s corporate
governance system. As an essential part of the control system,
actual data and up-to-date forecasts are reviewed monthly by the
Group Management Team. The control system includes, among other
things, sales reporting, an income statement, a rolling revenue and
profit forecast, and key figures that are important to operations.
Trainers’ House is an expert organization. The magnitude of market
and business risks is difficult to determine. Typical risks in this
area are related to, for example, general economic development,
customer distribution, technology choices, the development of
competition and the management of personnel costs. Risks are
managed through the planning and regular monitoring of sales, human
resources, and operating expenses, which enables rapid action when
circumstances change. The risks of trade receivables have been
taken into account by the recognition of expenses based on the age
of the receivables and individual risk analyzes. The goal of
Trainers’ House’s financial risk management is to secure the
availability of equity and debt financing on competitive terms and
to reduce the impact of adverse market movements on the company’s
operations. Financial risks are divided into four categories, which
are liquidity, interest rate risks, currency risks and credit
risks. Each risk is monitored separately. Liquidity and interest
rate risks are reduced with sufficient cash resources and efficient
collection of receivables. Currency risks are low as Trainers’
House operates primarily in the euro market. In financial risk
management, the focus is on liquidity. The success of Trainers’
House as an expert organization depends on its ability to attract
and retain skilled staff. In addition to a competitive salary,
personnel risks are managed through incentive schemes and
investments in personnel training, career opportunities and general
well-being. Technology is a key part of Trainers’ House’s business.
Technology risks include, but are not limited to, supplier risk,
risks related to internal systems, challenges posed by
technological change, and security risks. Risks are protected
against long-term cooperation with technology suppliers,
appropriate security systems, staff training and regular security
audits. Trainers’ House’s legal risks are mainly focused on the
contractual relationship between the company and customers or
service providers. At their most typical, they relate to delivery
responsibility and the management of intellectual property rights.
In order to manage the risks related to contracts and intellectual
property rights, the company has internal guidelines for
contractual procedures. In the company’s view, the contractual
risks are not unusual. At the end of the review period, goodwill
and other intangible assets recognized in the balance sheet have
been tested in the normal way. The test did not reveal any need for
impairment. The consolidated balance sheet of Trainers’ House has
goodwill of EUR 2.1 million. The balance sheet value of other
intangible assets is EUR 1.2 million. If the Group's profitability
does not develop as forecasted or other external factors
independent of the Group's operations, such as interest rates,
change significantly, it is possible that goodwill and other
intangible assets will have to be written off. Recognition of an
impairment loss would have no effect on the Group's cash flow. Due
to the project nature of the operations, the order backlog is
short, and predictability is therefore challenging. The description
of potential risks is not comprehensive. Trainers' House conducts
continuous risk assessment in connection with its operations and
strives to hedge against identified risks. Investors have also been
informed about the risks in the company’s annual review and on the
website at www.trainershouse.fi. PERSONNEL At the end of the review
period, the Group had 114 (111) employees. As before, the company's
definition is to report the number of employees converted to
full-time employees. DECISIONS REACHED AT THE ANNUAL GENERAL
MEETING The Annual General Meeting of Trainers' House Plc was held
on 30 March 2022, in Helsinki with exceptional arrangements due to
the Covid 19-pandemic. Shareholders and their proxies had the
opportunity to attend the Annual General Meeting and exercise their
rights only by voting in advance and submitting counterproposals
and questions in advance. Attending the meeting on the spot was not
possible. The meeting approved the financial statements and
consolidated financial statement for the financial year 2021 and
discharged the CEO and the members of the Board of Directors from
liability. The Annual General Meeting also approved the presented
remuneration report for the institutions. In accordance with the
proposal of the Board of Directors, the Annual General Meeting
decided that the number of the company's shares will be reduced
without reducing the share capital in accordance with Chapter 15,
Section 9 of the Companies Act by merging each ten shares into one
share. The purpose of the share consolidation is to improve the
conditions for trading and to increase flexibility in the
distribution of dividends. The combination of shares will not
affect the company's equity. In order to avoid the creation of
fractions of shares, the Board of Directors was authorized to
decide on a directed share issue in which the company's new shares
will be transferred free of charge by dividing the number of shares
according to each shareholder's book-entry account by ten. The
maximum number of new shares issued by the company is a maximum of
10,000 new shares. The company's Board of Directors has the right
to decide on the exact number of new shares to be issued and on all
other matters related to the issue of shares. The authorization is
valid until 30 June 2022. The merger will be carried out in such a
way that, at the same time as the above-mentioned new shares are
issued, the company will redeem free of charge from all
shareholders the number of shares in each shareholder's book-entry
account multiplied by 9/10, nine shares will be redeemed. The
number of shares held by a shareholder is estimated on a book-entry
basis. Shares redeemed free of charge will be cancelled immediately
upon redemption. The date of the share combination is 1 April 2022.
The combination of shares will take place on the day of the
combination in the book-entry system after the end of stock
exchange trading. If necessary, trading in the company's share on
Nasdaq Helsinki Ltd will be suspended in order to make technical
arrangements in the trading system after the date of the merger.
The cancellation of the shares and the new total number will be
registered in the Trade Register by approximately 4 April 2022, and
trading in the new total number of the company's shares will begin
under the new ISIN code on 4 April 2022. The company's Board of
Directors has the right to decide on all other matters related to
the redemption of shares. The arrangement does not require any
action from shareholders. In accordance with the proposal of the
Board of Directors, the Annual General Meeting decided that the
company will pay a dividend of EUR 0.70 for each share after the
merger of shares described above. The dividend will be paid in two
installments, with EUR 0.60 to be paid on 14 April 2022 (record
date for dividend payment on 7 April 2022) and EUR 0.10 to be paid
on 22 December 2022 (record date for dividend payment on 15
December 2022). The dividend will be paid to a shareholder who is
entered in the company's shareholder register on the record date of
the dividend payment. The number of Board members was confirmed to
be four (4). Aarne Aktan, Jarmo Hyökyvaara, Jari Sarasvuo and Elma
Palsila were elected as members. At the inaugural meeting held
after the Annual General Meeting, the Board elected Jari Sarasvuo
as its Chairperson. The Annual General Meeting decided on a
remuneration of EUR 1,500 per month for the Board member and EUR
3,500 per month for the Chairperson. Ernst & Young Oy was
re-elected as the company's auditor. The auditor is remunerated
according to the auditor's reasonable invoice. SHARES AND SHARE
CAPITAL The company’s share is listed on Nasdaq Helsinki Ltd under
the name Trainers’ House Plc (TRH1V). At the end of the reporting
period, Trainers’ House Plc had 21,471,412 shares and a registered
share capital of EUR 880,743.59. The company does not hold any of
its own shares. There have been no changes in the share capital
during the period. After the review period, the number of the
company's shares changed as a result of the reverse split and the
directed free share issue. The change in the number of shares took
place on 1 April 2022 after the end of trading, and trading in the
new number of shares and the ISIN code began on 4 April 2022. The
new number of shares of Trainers’ House is 2,147,826. Share
performance and trading
During the period under review, a total of 3.2 million shares,
or 15.0 % of the average number of all company shares (2.5 million
shares, 11.6 %), were traded on the Helsinki Stock Exchange for a
value of EUR 2.4 million (EUR 1.2 million). The period’s highest
share quotation was EUR 0.94 (EUR 0.70), the lowest EUR 0.66 (EUR
0.36) and the closing price EUR 0.92 (EUR 0.65). The weighted
average price was EUR 0.76 (EUR 0.48). At the closing price on 31
March 2022, the company’s market capitalization was EUR 19.8
million (EUR 13.8 million). SUMMARY OF FINANCIAL STATEMENTS AND
NOTES The report has been prepared in accordance with IAS 34. The
report has been prepared in accordance with IFRS standards and
interpretations that have been approved for application in the EU
and are in force on 1 January 2022. In this financial statement
bulletin, Trainers’ House has followed the same accounting policies
and calculation methods as in the 2021 annual financial statements.
The figures given in the interim report are unaudited.
INCOME STATEMENT IFRS (kEUR) |
1-3/2022 |
1-3/2021 |
1-12/2021 |
NET SALES |
2 687 |
2 762 |
10 340 |
Other operating income |
6 |
0 |
0 |
Expenses: |
|
|
|
Materials and services |
-110 |
-202 |
-717 |
Personnel-related expenses |
-1 580 |
-1 382 |
-5 916 |
Depreciation and impairment losses |
-114 |
-129 |
-535 |
Other operating expenses |
-528 |
-489 |
-1 856 |
Total expenses |
-2 332 |
-2 203 |
-9 024 |
Operating result |
361 |
559 |
1 316 |
Financial income and expenses |
-4 |
-7 |
-26 |
Profit before taxes |
358 |
553 |
1 291 |
Income taxes |
1 |
3 |
0 |
PROFIT FOR THE PERIOD |
358 |
556 |
1 291 |
Profit attributable to: Owners of the parent company |
358 |
556 |
1 291 |
Earnings per share: |
0.02 |
0.03 |
0.06 |
Earnings per share attributable to owners of the parent
company |
0.02 |
0.03 |
0.06 |
BALANCE SHEET IFRS (kEUR) |
3/2022 |
3/2021 |
12/2021 |
ASSETS |
|
|
|
Non-current assets |
|
|
|
Tangible assets |
807 |
1 088 |
907 |
Goodwill |
2 129 |
2 129 |
2 129 |
Other intangible assets |
1 153 |
1 165 |
1 123 |
Long-term receivables |
|
|
|
Other receivables, long-term |
106 |
0 |
104 |
Deferred tax receivables |
200 |
203 |
200 |
Total long-term receivables |
306 |
204 |
304 |
Total non-current assets |
4 395 |
4 587 |
4 463 |
|
|
|
|
Current assets |
|
|
|
Inventories |
0 |
6 |
0 |
Account receivables and other receivables |
1 182 |
1 485 |
1 045 |
Cash and cash equivalents |
3 513 |
3 390 |
3 378 |
Total current assets |
4 695 |
4 881 |
4 424 |
TOTAL ASSETS |
9 090 |
9 468 |
8 887 |
SHAREHOLDERS’ EQUITY AND LIABILITIES |
|
|
|
Equity attributable to the owners of the parent company |
|
|
|
Share capital |
881 |
881 |
881 |
Distributable non-restricted equity fund |
37 |
37 |
37 |
Retained earnings |
3 540 |
4 826 |
3 752 |
Profit for the period |
358 |
556 |
1 291 |
Total shareholders’ equity |
4 816 |
6 300 |
5 961 |
Long-term liabilities |
|
|
|
Deferred tax liabilities |
227 |
233 |
229 |
Long-term financial liabilities |
364 |
621 |
408 |
Other long-term liabilities |
0 |
0 |
0 |
Total long-term liabilities |
590 |
854 |
637 |
Short-term liabilities |
|
|
|
Short-term financial liabilities |
282 |
331 |
317 |
Accounts payable and other liabilities |
3 401 |
1 983 |
1 971 |
Total short-term liabilities |
3 683 |
2 315 |
2 288 |
Total liabilities |
4 274 |
3 168 |
2 925 |
TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES |
9 090 |
9 468 |
8 887 |
CASH FLOW STATEMENT IFRS (kEUR) |
1-3/2022 |
1-3/2021 |
1-12/2021 |
CASH FLOW FROM OPERATIONS |
|
|
|
Profit for the period |
358 |
556 |
1 291 |
Adjustments to profit for the period |
116 |
133 |
543 |
Changes in working capital |
-212 |
-358 |
-11 |
Cash flow from operations before financial items and taxes |
262 |
330 |
1 823 |
Financial items and taxes |
-4 |
-7 |
-30 |
CASH FLOW FROM OPERATIONS |
258 |
323 |
1 793 |
CASH FLOW FROM INVESTMENTS |
|
|
|
Investments in tangible and intangible assets |
-44 |
-107 |
-175 |
CASH FLOW FROM INVESTMENTS |
-44 |
-107 |
-175 |
CASH FLOW FROM FINANCING |
|
|
|
Repayment of lease liabilities |
-80 |
-94 |
-433 |
Dividends paid |
0 |
0 |
-1 074 |
CASH FLOW FROM FINANCING |
-80 |
-94 |
-1 507 |
TOTAL CASH FLOW |
135 |
123 |
111 |
CHANGE IN CASH AND CASH EQUIVALENTS |
|
|
|
Opening balance of cash and cash equivalents |
3 378 |
3 267 |
3 267 |
Closing balance of cash and cash equivalents |
3 513 |
3 390 |
3 378 |
CHANGE IN CASH AND CASH EQUIVALENTS |
135 |
123 |
111 |
|
|
|
|
CHANGE IN SHAREHOLDERS’ EQUITY (kEUR)Equity attributable to
owners of the parent company
CHANGE IN SHAREHOLDERS’ EQUITY (kEUR) |
Share capital |
Distributable non-restricted equity fund |
Retained earnings |
Total |
Equity 1 January 2021 |
881 |
37 |
4 826 |
5 744 |
Other comprehensive income |
|
|
556 |
556 |
Dividends paid |
|
|
0 |
0 |
Equity 31 March 2021 |
881 |
37 |
5 382 |
6 300 |
|
|
|
|
|
Equity 1 January 2022 |
881 |
37 |
5 043 |
5 961 |
Other comprehensive income |
|
|
358 |
358 |
Dividends paid |
|
|
-1 503 |
-1 503 |
Equity 31 March 2022 |
881 |
37 |
3 898 |
4 816 |
RELATED PARTY TRANSACTIONS During the period under review,
Trainers’ House had transactions with Causa Prima Ltd, a company
controlled by Jari Sarasvuo, a member of the Board of Directors,
and Pro Vividus Ltd and Anorin Liekki Ltd, which are related to the
company. The following transactions took place with related
parties:
RELATED PARTY TRANSACTIONS kEUR |
1-3/2022 |
1-3/2021 |
1-12/2021 |
Purchases |
94 |
37 |
164 |
|
3/2022 |
3/2021 |
12/2021 |
Liabilities at the end of the period |
47 |
41 |
45 |
RESTRUCTURING PROVISION (kEUR) |
Konserni |
Konserni |
Konserni |
|
3/2022 |
3/2021 |
12/2021 |
Provisions at the beginning of the period |
0 |
17 |
17 |
Provisions used |
0 |
-3 |
-17 |
Provisions at the end of the period |
0 |
14 |
0 |
PERSONNEL |
1-3/2022 |
1-3/2021 |
1-12/2021 |
Average number of personnel |
114 |
108 |
118 |
Personnel at the end of the period |
114 |
111 |
126 |
COMMITMENTS AND CONTINGENT LIABILITIES |
3/2022 |
3/2021 |
12/2021 |
Collaterals and contingent liabilities given for own
commitments |
136 |
134 |
136 |
OTHER KEY FIGURES |
3/2022 |
3/2021 |
12/2021 |
Equity ratio (%) |
54.7 % |
69.5 % |
69.8 % |
Shareholders' equity/share (EUR) |
0.22 |
0.29 |
0.28 |
Calculation formulas for key figures Earnings per
share = Profit for the
period attributable to owners of the parent company
Average number of shares
adjusted for share
issue in financial period Interest-bearing net debt =
Interest-bearing liabilities – cash and cash equivalents Equity
ratio (%) =
Equity x 100
Balance sheet total – advances received Equity /
share
=
Equity
Number of shares adjusted for share issue at the
end of
financial period
Items affecting the calculation of key figures |
3/2022 |
3/2021 |
12/2021 |
Advances received (kEUR) |
283 |
402 |
344 |
Interest-bearing liabilities (kEUR) |
646 |
952 |
725 |
Average number of shares adjusted for share issue in financial
period (unit thousand shares) |
21 471 |
21 471 |
21 471 |
Number of shares adjusted for share issue at the end of the
financial period (unit thousand shares) |
21 471 |
21 471 |
21 471 |
In Helsinki 28 April 2022 TRAINERS’ HOUSE PLC BOARD OF DIRECTORS
Information: Arto Heimonen, CEO, +358 404 123 456 Saku
Keskitalo, CFO, +358 404 111 111 DISTRIBUTION Nasdaq Helsinki Main
media www.trainershouse.fi – For investors
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