OREANDA-NEWS. Consolidated net sales of the third quarter of 2015 were 4.8 mil. euros, representing a 3% decrease on the third quarter compared to the same period in 2014. At the same time, consolidated EBITDA amounted to 287 thousand euros (EBITDA 165 thousand euros in Q3 2014). Net sales during 9 month in 2015 amounted to 14.5 mil. euros, representing 7% decrease (2014 9 months net sales: 15.7 mil. euros). First 9 months EBITDA in 2015 was 811 thousand euros exceeding a bit last year level (2014 9 months EBITDA: 696 thousand euros). Although consolidated net sales have decreased mainly due to weak demand in Finland and Russia, the company has managed to improve EBITDA margin and achieved a better result compared to last year. The main reasons behind it are improvements of fibreboard production process allowing to reduce production cost and keep profitability at much lower production volumes.

The sale in Skano Fibreboard O? Parnufactory (incl. Isotex) was 2.0 mil. euros, being at the same level as compared to the respective period last year, the operating profit of the third quarter was 140 thousand euros compared with the operating profit 48 thousand euros last year.

The turnover of Skano Fibreboard O? P?ssi factory was 1.3 mil. euros, representing 7% decrease in the third quarter compared to the same period in 2014. Operating profit amounted to 5 thousand euros compared with the operating loss 24 thousand euros last year.

Sales mainly decreased in our core markets. As our main foreign markets Russia and Finland are still very weak due to the general economic situation we have been continuously expanding the list of our target markets and made significant efforts in product development. In the third quarter we also conducted product testing and tuning of production process in both factories in order to achieve a lower production cost and break-even point.  

The priority of the management of the company is continuously to ensure the sales of the production of both factories in order to guarantee the maximum production capacity and efforts are taken in this direction on an on-going basis.

Sales of Suomen Tuulielijona OY in Q3 2015 decreased 2% compared to last year, which amounted to 1.3 mil. euros. Suomen Tuulileijona OY is the wholesaler of Skano fibreboard products in Finland, which was acquired at the beginning of July 2014.

The turnover of Skano Furniture Factory O? in Parnudecreased in the third quarter by 2% and amounted to 1.1 mil. euros. The operating loss of the third quarter was 88 thousand euros as in 2014 the operating loss of the same period was 65 thousand euros. Profitability was impacted by low sales volumes. In the third quarter of 2015 sales to Russia decreased due to very weak demand by 13% as compared to 2014. Sales to Finland increased slightly and also in the Baltics. In addition to seeking new sales possibilities in the current markets the company has made considerable effort to enter into new markets like UK, France and USA.

The turnover of Skano Furniture O? retail chain increased 8% as compared to the same period last year being 602 thousand euros, operating profit was 6 thousand euros compared with the sales 543 thousand and operating loss 14 thousand euros in the third quarter of 2014. 2015 third quarter operating profit 6 thousand euros contains also a loss from a drop of currency exchange rate of hryvnia 22 thousand euros (realized loss from currency exchange rate 20 thousand euros in the same period of 2014).

Retail sale increased in Estonia, Latvia and Ukraine but decreased slightly in Lithuania. Retail sale is still very weak in Ukraine due to the conflict and difficult economic situation. The sales of Skano Furniture Factory O? own furniture still forms a considerable part of the retail sale and it enables the furniture factory to operate much more profitably than it would be possible without its own retail chain.