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Sector
Consumer Cyclicals
Size
Mid Cap
Market Cap £366.1m
Enterprise Value £347.8m
Revenue £479.7m
Position in Universe 563rd / 1831

Verkkokauppa.com Oyj: Strong performance with an additional dividend proposed – strategy now set towards 1 billion in sales by 2025

Fri 12th February, 2021 6:00am
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FINANCIAL STATEMENT RELEASE for 1 January – 31 December 2020: Strong
performance with an additional dividend proposed – strategy now set towards
1 billion in sales by 2025

Verkkokauppa.com Oyj – Financial Statement Release (unaudited) 12 February
2021, 8:00 a.m.

1 October – 31 December 2020 in brief
* Revenue 176 million euros (10-12/2019: 160), growth of 10.1%
* Gross profit 26.7 million euros (22.2), growth of 20.1%
* Gross margin 15.1% of revenue (13.9%)
* Operating profit 6.2 million euros (4.5)
* Operating margin 3.5% of revenue (2.8%)
* Comparable operating profit 6.2 million euros (4.5)
* Comparable operating margin 3.5% (2.8%)
* Profit for the period 4.7 million euros (3.2)
* Earnings per share 0.10 euros (0.07)
* Investments 0.4 million euros (0.4)
* Operating cash flow 10.4 million euros (11.6)       
 KEY RATIOS                                 10-12/2020  10-12/2019  Change%  1-12/2020  1-12/2019  Change%  
                                                                                                            
 Revenue, € million                         176.0       159.9       10.1%    553.6      504.1      9.8%     
 Gross profit, € million                    26.7        22.2        20.1%    88.4       73.9       19.7%    
 Gross margin, % of revenue                 15.1%       13.9%       9.1%     16.0%      14.7%      9.0%     
 EBITDA, € million                          7.5         5.7         31.4%    24.6       16.3       50.6%    
 EBITDA, %                                  4.3%        3.6%        19.4%    4.4%       3.2%       37.1%    
 Operating profit, € million                6.2         4.5         38.9%    19.6       11.3       73.5%    
 Operating margin, % of revenue             3.5%        2.8%        26.2%    3.5%       2.2%       57.9%    
 Comparable operating profit, € million     6.2         4.5         38.9%    20.4       11.3       80.6%    
 Comparable operating margin, % of revenue  3.5%        2.8%        26.2%    3.7%       2.2%       64.4%    
 Net profit, € million                      4.7         3.2         44.1%    14.6       7.8        87.2%    
                                                                                                            
 Investments, € million                     0.4         0.4         10.4%    1.4        1.2        8.9%     
 Operating cash flow, € million             10.4        11.6        -10.8%   16.9       9.7        74.2%    



1 January – 31 December 2020 in brief
* Revenue 554 million euros (1–12/2019: 504), growth of 9.8%
* Gross profit 88.4 million euros (73.9), growth of 19.7%
* Gross margin 16.0% of revenue (14.7%)
* Operating profit 19.6 million euros (11.3)
* Operating margin 3.5% of revenue (2.2%)
* Comparable operating profit 20.4 million euros (11.3)
* Comparable operating margin 3.7% (2.2%)
* Profit for the period 14.6 million euros (7.8)
* Earnings per share 0.33 euros (0.17)
* Investments 1.4 million euros (1.2)
* Operating cash flow 16.9 million euros (9.7)
* The Board of Directors proposes to the annual general meeting that for the
financial year 2020 a total dividend of 0.45 euro per share be distributed
(0.230 euro per share in quarterly installments and an additional dividend of
0.220 euro per share be distributed in conjunction with the annual general
meeting)
BUSINESS OUTLOOK

Verkkokauppa.com Oyj’s business operations are estimated to develop
positively in the future. The company believes that it will succeed in further
growing its market share in the chosen categories. The strong balance sheet
enables the company to continue expanding its operations in accordance with
its strategy.

The company has benefited from the shifting consumer behavior accelerated by
the COVID-19 pandemic, as the sales in the online sales channel have shown
strong growth. The company expects this trend to continue the longer the
COVID-19 pandemic persists and that the accelerated shift to online sales
channels continues.

At the same time, the prolongation of the COVID-19 pandemic continues to have
a negative impact on spending on travel and service sectors. On the one hand,
this has positively affected the consumer demand for goods, but on the other
hand, it has limited the lower-margin wholesale business. The short-term risk
is that COVID-19 situation and related restrictions continues longer than
anticipated in Finland. This may have an impact on the company’s operations
and its ability to safely serve customers in the brick-and-mortar stores.

The uncertainties concerning the future business outlook remain and relate to
macroeconomic developments and the prevailing COVID-19 situation. The pandemic
may still cause unforeseen impacts on the overall economic development,
consumer demand as well as consumer purchase behavior and B2B sales in the
future. Nevertheless, the company believes that it is well positioned and will
be a relative winner in the “new normal” business environment of the
future.

FINANCIAL GUIDANCE

The company expects the revenue to be between 570–620 million euros (2020:
554 million euros) and comparable operating profit to be between 20–26
million euros (2020: 20.4 million euros) in 2021.

CEO PANU PORKKA’S REVIEW

In 2020, online shopping became the preferred way of shopping for a growing
number of Finns. This migration from offline to online was accelerated by the
COVID-19 pandemic when people had to reduce visits to physical stores and got
used to the convenience of online shopping and home deliveries. As a pioneer
of ecommerce, Verkkokauppa.com clearly benefitted from this trend.

The peak shopping season began on Black Friday and continued until Christmas.
During this online shopping season of all times, the increased preference for
shopping online could also be seen in Verkkokauppa.com’s business, as
already 66% of all purchases from Verkkokauppa.com were done online and 65% of
these online purchases were delivered home. In the same period, the number of
visitors on Verkkokauppa.com’s website grew by 25% compared to the same
period last year and reached an all-time high of 14.2 million (11.4 million).

Verkkokauppa.com’s revenue returned to double-digit growth, increasing by
10.1% to 176 million euros (160) in the fourth quarter. The growth was driven
by the strong performance of mid-sized product categories, especially major
domestics appliances (MDA) and sports equipment. The development of MDA
category was especially satisfying, and it is growing from a mid-sized
category to one of Verkkokauppa.com’s core categories. At the same time, the
export business continued to suffer from travel restrictions due to COVID-19.

Verkkokauppa.com’s profitability continued to develop favorably in the
fourth quarter. The company’s gross margin grew to 15.1% of revenue (13.9%),
especially driven by the strong performance of mid-sized, higher-margin
categories. Also, the comparable operating profit grew, reaching a record-high
6.2 million euros (4.5). In each quarter of 2020, the company has delivered
the best-ever comparable operating profit of that respective quarter. In the
fourth quarter, Verkkokauppa.com’s comparable operating profit was the best
quarterly comparable operating profit in the company’s history.

Verkkokauppa.com’s latest ranking in the YouGov BrandIndex is also source of
pride. Verkkokauppa.com is the most recommended brand in its comparison group.
Our brand is clearly and positively on people’s mind when they are making
purchase decisions. These results show that persistent and systematic work in
developing the brand is paying off.

Today, Verkkokauppa.com’s announced its refined strategy. The company’s
vision is to remain as a pioneer of ecommerce also in the next decades through
continuous innovation. The company’s success will be built on five pillars:
excellent customer experience and strong brand, efficient fulfilment, superior
technology backbone, extensive assortment and cost competitiveness.
Verkkokauppa.com is seeking growth both within its core categories as well as
by expanding into segments with attractive margin potential, especially
online. Additionally, the company sees attractive growth opportunities in the
B2B segment, private labelling and in value added services. We are also
keeping our eyes open for potential M&A opportunities. By getting all this
right, Verkkokauppa.com will aim to reach an annual revenue of one billion
euros and a 5% EBIT margin by the end of 2025.

I’m proud of Verkkokauppa.com’s performance in 2020 and wish to thank our
personnel for their hard work during these unusual times, and our shareholders
and customers for their continued trust. Verkkokauppa.com is in an excellent
position to benefit from the ecommerce boom. In 2021, we want to increase
Verkkokauppa.com’s market share, especially online, and continue to deliver
on the company’s customer promise of “Probably always cheaper prices”.



REVENUE AND PROFITABILITY DEVELOPMENT

October–December 2020

In October–December 2020, Verkkokauppa.com Oyj’s revenue grew by 10.1%
year on year. Revenue grew by 16.1 million euros, totaling 176 million euros
(159.9). Sales increased particularly in Major domestic appliances, Small
domestic appliances, Sports, Toys, Office & Supplies, and Home & Lighting.

The company-financed customer financing proceeds were 1.0 million euros (0.9)
including both interest income and fee income. The credit loss allowance was
increased by 0.2 million euros (0.1) in the fourth quarter.

Personnel costs increased in October–December by 14.3% to 10.4 million euros
(9.1). The increase resulted mainly from the growing personnel costs in IT
administration, purchasing, retail stores, customer service and from bonus
payment covering the whole staff. During the reporting period, other operating
expenses increased by 18.6% to 8.9 million euros (7.5). The increase resulted
mainly from higher external logistics service costs, increased IT and
marketing expenses and increased credit loss allowance.

Operating profit in October–December 2020 was 6.2 million euros (4.5),
comparable operating profit was 6.2 (4.5) and profit for the period 4.7
million euros (3.2).

                                                                           10-12/  10-12/  1-12/  1-12/  
 EUR million                                                               2020    2019    2020   2019   
 Operating profit                                                          6.2     4.5     19.6   11.3   
 - advisory costs related to transfer to official list of Nasdaq Helsinki  -       -       0.8    -      
 Comparable operating profit                                               6.2     4.5     20.4   11.3   

Earnings per share were 0.10 euros (0.07) in October–December 2020. In
January–December 2020 earnings per share were 0.33 euros (0.17).

January–December 2020

In January–December 2020, Verkkokauppa.com Oyj’s revenue grew by 10.1%
year on year. Revenue grew by 49.5 million euros, totaling 553.6 million euros
(504.1). Sales increased particularly in Major domestic appliances (MDA),
Sports, Audio & Hi-Fi, Office & Supplies, BBQ and Toys.

The company-financed customer financing proceeds were 3.6 million euros (3.3)
including both interest income and fee income. To reflect the prevailing
uncertainty related to customers’ payment behavior in the future and changes
in continues debt sales pricing, the credit loss allowance was increased
compared to the end of 2019 and totaled 1.1 million euros (0.6). As of April
2019, Verkkokauppa.com has been selling past due receivables in a so-called
continuous debt sales model, where receivables overdue more than 60 days will
be sold to third parties. This decreases company’s accounts receivable risk.

Personnel costs increased in January–December by 9.1% to 35.6 million euros
(32.6). The increase resulted mainly from the growing personnel costs in IT
administration, marketing, retail stores and from bonus payment covering the
whole staff. During the reporting period, other operating expenses increased
by 13.1% to 28.8 million euros (25.5). The increase was mainly driven by
advisory costs relating to transferring to the official list of Nasdaq
Helsinki, increased credit loss allowance, external logistics service costs
and IT-related costs.

Operating profit in January–December 2020 was 19.6 million euros (11.3),
comparable operating profit was 20.4 (11.3) and profit for the period 14.6
million euros (7.8). Items affecting comparable operating profit totaled 0.8
million euro (0.0).

FINANCE AND INVESTMENTS

Operating cash flow was 16.9 million euros (9.7) in January–December 2020.
In the reporting period, the relative improvement of the operating cash flow
resulted from improved sales margin.

Ordinary seasonal fluctuations are reflected in cash and cash equivalents,
cash flow and accounts payable, which usually reach the highest point at the
end of the fourth quarter and the lowest point at the end of the second
quarter.

Investments totaled 1.4 million euros (1.2) in January–December 2020. During
the reporting period the company invested and capitalized 0.6 million euros
(0.1) in salary costs and external technology consulting fees related to new
IT systems and the development of new ERP features. Capital expenditures
totaled 0.3 million euros (0.4) in October–December 2020.

Verkkokauppa.com has revolving credit facilities totaling 20 million euros,
which have not been utilized. Of these credit facilities, 15 million euros are
for three years, and 5 million euros for five years as of 1 July 2019.

SHARE TRADING AND SHARES

During the reporting period, 26,714,366 shares were exchanged until 4 June on
the First North Growth Market of Nasdaq Helsinki Ltd marketplace and on 5 June
onwards on the official list of Nasdaq Helsinki Ltd, representing 59.3% of all
shares in the company. The highest share price was 7.90 euros and the lowest
2.49 euros. The average price in share trading was 4.95 euros. The total of
the share trading was 132.3 million euros. The closing price was 7.12 euros,
and the market capitalization of all shares was 320.9 million euros at the end
of the period.

The total number of shares in the company was 45,065,130 on 31 December 2020,
including treasury shares. In 2020, the company has transferred a total of
25,318 treasury shares as part of the remuneration of Board members. The
company held 352,898 treasury shares on 31 December 2020. These treasury
shares accounted for 0.78% of all shares. The treasury shares have no voting
rights and no dividend is paid on them.

The Board holds a valid authorization to issue a maximum of 4,506,513 shares
on a share issue by one or several decisions (share issue authorization of
2020). The Board has utilized its share issue authorization solely for
transferring shares as part of the remuneration of Board members.

LONG-TERM INCENTIVE PLANS

Verkkokauppa.com has two share-based incentive plans for the CEO and members
of the Management Team, the Matching Share Plan 2018–2020 and the
Performance Matching Share Plan 2020–2022. The aim of the plans is to align
the objectives of the shareholders and the management in order to increase the
company’s value in the long term, to encourage the management to personally
invest in the company shares, to retain the members of the Management Team at
the company and to offer them a competitive reward plan that is based on
acquiring, earning and accumulating the company’s shares.

In the Matching Share Plan 2018–2020, the participant may earn a number of
matching shares, determined by the Board of Directors, based on their
investment in Verkkokauppa.com Oyj’s shares. The Matching Share Plan has two
matching periods: 2018–2020 and 2019–2021. The rewards to be paid on the
basis of the matching period 2018–2020 correspond to the value of maximum
total of 50,000 Verkkokauppa.com Oyj’s shares, and on the basis of the
matching period 2019–2021 to the value of maximum total of 45,000
Verkkokauppa.com Oyj’s shares, including also the proportions to be paid in
cash.

In the Performance Matching Share Plan 2020–2022, a person may earn a number
of matching shares based on their investment in Verkkokauppa.com Oyj’s
shares and the Total Shareholder Return (TSR) of the share. The Performance
Matching Share Plan includes one performance period, calendar years
2020–2022. The reward to be paid to participants is based on the achievement
of the required TSR levels set by the Board of Directors. A maximum of three
performance-based matching shares is paid for each allocated share. The
rewards to be paid on the basis of the plan correspond to the value of
approximately 540,000 Verkkokauppa.com Oyj shares in total (gross amount).

PERSONNEL

During the reporting period, the number of employees increased by 7.9%, and
the total number of employees was 818 (758) at the end of December 2020. The
number of employees includes both full- and part-time employees.

SHAREHOLDERS’ NOMINATION BOARD

On 22 September 2020, Verkkokauppa.com announced that the Shareholders'
Nomination Board had been appointed, based on ownership on the last banking
day in May. At its organizational meeting on 22 September 2020, the following
members of the Nomination Board were appointed:
* Samuli Seppälä, Founder of Verkkokauppa.com, representing himself,
* Peter Lindell, Partner and Chairman of Rite Ventures, appointed by Rite
Ventures Finland AB,
* Erkka Kohonen, Senior Portfolio Manager, appointed by Varma Mutual Pension
Insurance Company,
* Christoffer Häggblom, Chair of the Board of Verkkokauppa.com Oyj
The Chair of the Nomination Board is Peter Lindell.

Verkkokauppa.com’s Shareholders’ Nomination Board was established in 2020
by the Annual General Meeting. Its duty is to prepare proposals on the number,
election and remuneration of the members of the Board to the General Meeting.
Its proposal will be published by the end of February 2021 at the latest.

RISKS AND UNCERTAINTIES

Verkkokauppa.com Oyj’s risks and uncertainties reflect the market and
general economic trends, for example, demand for consumer electronics,
wholesale trade business, the business environment and competition. The
company’s business operations are also influenced by risks and uncertainties
relating to, for example, business strategy, investments, procurement and
logistics, information technology, and other operative aspects of the
business. The aforementioned risks and uncertainties may affect the
company’s operations, financial position and performance both positively and
negatively. Risks and uncertainties have been presented in more detail in the
Annual Report.

Uncertainty in the development of the economy and the financial markets in
Finland, Europe and the world may have a negative impact on the business and
growth opportunities of Verkkokauppa.com. The COVID-19 pandemic affects
people’s lives and the operation of businesses in Finland and globally
alike. The COVID-19 pandemic continues, and its overall impacts on the
Company’s business are difficult to assess.

LITIGATION AND DISPUTES

Verkkokauppa.com has no open litigation issues nor any significant disputes.

ANNUAL GENERAL MEETING 2020

The Annual General Meeting was held in Helsinki on 31 March 2020. The
financial statements for the year 2019 were approved, the Remuneration Policy
was considered, and the Board members and the CEO were discharged from
liability with respect to financial year 2019. It was resolved to pay a
dividend of 0.052 euros per share, totaling 2,339,612.96 euros.

The Annual General Meeting authorized the Board of Directors to decide in its
discretion on the distribution of dividends as follows: The total amount of
the dividend distribution based on this authorization shall not exceed EUR
0.162 per share (the instalments may differ from another). The authorization
is valid until the opening of the next Annual General Meeting. Unless the
Board of Directors decides otherwise, the authorization will be used to
distribute dividend three times during the period of validity of the
authorization and the payment dates of the dividends will be on 6 May 2020, 4
August 2020 and 3 November 2020. The Board of Directors will decide on the
record date in connection with each dividend payment decision and the company
will make separate announcements of Board resolutions.

The number of Board members was confirmed as six. All current Board members,
Christoffer Häggblom, Robert Burén, Mikael Hagman, Kai Seikku, Arja Talma
and Samuli Seppälä, were re-elected. After the meeting, the Board elected
Christoffer Häggblom as the Chair of the Board and resolved to continue with
an Audit Committee and Remuneration Committee. The Audit Committee consists of
Board members Kai Seikku (Chair), Arja Talma (Vice Chair), Christoffer
Häggblom and Samuli Seppälä. The Remuneration Committee consists of Board
members Christoffer Häggblom (Chair), Samuli Seppälä and Kai Seikku.

The Authorized Public Accountant PricewaterhouseCoopers Oy was re-elected as
the auditor, who has notified the company that Authorized Public Accountant
Ylva Eriksson will be acting as the Principal Auditor.

The Annual General Meeting authorized the Board to decide on the repurchase of
a maximum of 4,506,513 shares in one or several instalments using the
unrestricted equity of the Company, however taking into account the provisions
of the Finnish Limited Liability Companies Act on the maximum number of the
treasury shares held by the company or its subsidiaries. The proposed number
of shares represents a maximum of ten (10) per cent of the total number of
shares in the company. The authorization is valid until the close of the
following Annual General Meeting, however, no longer than until 30 June 2021.
The authorization revokes previous unused authorizations for the repurchase of
the company’s own shares.

The Annual General Meeting authorized the Board of Directors to decide on a
share issue by one or several decisions. A maximum of 4,506,513 shares may be
issued on the basis of the authorization. The proposed maximum authorized
number represents ten (10) percent of the company’s entire share capital.
The authorization is valid until the close of the following Annual General
Meeting, however, no longer than until 30 June 2021. The authorization revokes
previous unused share issue authorizations.

In addition, the Annual General Meeting resolved to establish a
Shareholders’ Nomination Board, to prepare proposals on the election and
remuneration of the members of the Board of Directors for the Annual General
Meeting as well as confirm the charter of the Shareholders’ Nomination
Board. The Nomination Board consists of four members, three of which represent
the Company’s three largest shareholders, or the representatives nominated
by such shareholders. The Chair of the Board of Directors shall be the fourth
member of the Nomination Board. The right to nominate members to represent
shareholders rests with three shareholders who are registered in the
shareholders’ register maintained by Euroclear Finland Ltd or another
operator on the last business day of May in the year preceding the Annual
General Meeting and who hold the largest number of votes conferred by shares
according to the shareholder register.

DIVIDEND

The Annual General Meeting 2020 resolved to pay 0.052 euros (2,339,612.96
euros in total) per share as dividend. The dividend payment date was 9 April
2020.

The Board resolved on 24 April 2020 to pay a dividend of 0.053 euros per share
(2,384,605.52 euros in total). The dividend payment date was 6 May 2020.

The Board resolved on 24 July 2020 to pay a dividend of 0.054 euros per share
(2,413,923.34 euros in total).
The dividend payment date was 4 August 2020.

The Board resolved on 23 October 2020 to pay a dividend of 0.055 euros per
share (2,458,892,92 euros in total). The dividend payment date was 3 November
2020.

Verkkokauppa.com’s Annual General Meeting authorized the Board of Directors
to decide in its discretion on the distribution of dividends not exceeding
0.162 euro per share to be paid in three instalments during 2020. Following
the distribution of dividends resolved on 23 October 2020 by the Board, the
Company does not have any valid authorizations for distribution of dividends.

DIVIDEND DISTRIBUTION PROPOSAL

Verkkokauppa.com Oyj’s distributable funds as of 31 December 2020 totaled
40,014,114.29 euro. The Board of Directors will propose to the Annual General
Meeting that Verkkokauppa.com Oyj net income for period 14,621,552.33 euro
will be transferred to retained earnings. The Board will propose to the Annual
General Meeting that for the financial year 2020 a total dividend of 0.450
euro per share be distributed, divided into a dividend of 0.230 euro paid
quarterly and an additional dividend of 0.220 euro paid in conjunction with
the Annual General Meeting 2021. The proposal is based on the strong
performance in 2020 and company’s strong liquidity position.

OTHER EVENTS DURING THE REPORTING PERIOD

On 13 February 2020 Verkkokauppa.com announced that the company is currently
evaluating the possibility of transferring to the main list of Nasdaq Helsinki
during 2020.

On 13 February 2020 Verkkokauppa.com announced to establish a new share-based
incentive plan for the CEO and the members of the Management Team.

On 24 April 2020 Verkkokauppa.com announced that it will start purchasing the
company’s own shares.

Between 14 May and 1 July 2020 Verkkokauppa.com announced several (26) daily
share repurchase announcements.

On 28 May 2020 Verkkokauppa.com announced that it will apply for its shares to
be listed on the official list of Nasdaq Helsinki Ltd.

On 29 May 2020 Verkkokauppa.com announced that the Finnish Financial
Supervisory Authority has approved Verkkokauppa.com Oyj’s Finnish-language
prospectus.

On 4 June 2020 Verkkokauppa.com announced that Verkkokauppa.com Oyj’s
listing application has been approved and trading of the company’s shares on
the official list of Nasdaq Helsinki Ltd will commence on 5 June 2020.

On 2 July 2020 Verkkokauppa.com announced that it has completed the repurchase
of the company’s own shares.

On 21 July 2020 Verkkokauppa.com provided preliminary information on its
second-quarter revenue and comparable operating profit and issued a positive
profit warning.

On 24 September 2020 Verkkokauppa.com issued a positive profit warning and
upgraded its guidance for 2020.

On 27 November 2020 Verkkokauppa.com announced that HR Director and member of
the management team Taina Suorsa has resigned to take on new challenges
outside Verkkokauppa.com.

SUBSEQUENT EVENTS

On 4 January 2021 Verkkokauppa.com announced that Board member Mikael Hagman
had resigned from the company’s Board.

On 27 January 2021 Verkkokauppa.com announced that Saara Tikkanen has been
appointed HR Director and member of the management team.

On 12 February 2021 Verkkokauppa.com announced company’s refined strategy
and long-term financial targets until end of 2025.



PRESS CONFERENCES

A press conference for analysts, investors and media will be held in Finnish
by LiveStream webcast on Friday, 12 February 2021 at 10:00 a.m., in which
Verkkokauppa.com Oyj’s CEO Panu Porkka will present the developments in the
reporting period.

A press conference in English will be held by LiveStream webcast on Friday, 12
February 2021 at 11:00 a.m. (EET). Questions can be sent beforehand or during
the presentation via e-mail to investors@verkkokauppa.com.

Presentation materials for both events are available at
https://investors.verkkokauppa.com/en/presentations. For both press
conferences, a LiveStream is available at www.verklive.com.

COMPANY RELEASES IN 2021/2022

Verkkokauppa.com Oyj will publish its financial reports as follows:
* Annual Report 2020 will be published online during week 9, 2021
* Interim Report January–March 2021, Friday 23 April 2021
* Half-year Report January–June 2021, Friday 16 July 2021
* Interim Report January–September 2021, Friday 22 October 2021
Helsinki, Finland, 12 February 2021

Verkkokauppa.com Oyj

Board of Directors

More information:

Panu Porkka, CEO 
 e-mail panu.porkka@verkkokauppa.com
 Telephone +358 10 309 5555

Mikko Forsell, CFO 
 e-mail mikko.forsell@verkkokauppa.com
 Telephone +358 50 434 2516

Distribution:

Nasdaq Helsinki
 Key media
 www.verkkokauppa.com

VERKKOKAUPPA.COM OYJ FINANCIAL STATEMENTS RELEASE 1 Jan – Dec 31, 2020

Income statement

                                                                                     10-12/    10-12/    1-12/     1-12/     
 EUR thousand                                                                  Note  2020      2019      2020      2019      
                                                                                                                             
 Revenue                                                                       1.3   176,009   159,908   553,636   504,113   
                                                                                                                             
 Other operating income                                                              188       153       558       555       
 Materials and services                                                              -149,348  -137,710  -465,222  -430,239  
 Employee benefit expenses                                                           -10,419   -9,115    -35,560   -32,595   
 Depreciation and amortization                                                       -1,306    -1,246    -5,010    -5,040    
 Other operating expenses                                                            -8,920    -7,523    -28,818   -25,504   
                                                                                                                             
 Operating profit                                                                    6,203     4,467     19,583    11,290    
                                                                                                                             
 Finance income                                                                      3         2         11        64        
 Finance costs                                                                       -363      -421      -1,423    -1,591    
                                                                                                                             
 Profit before income taxes                                                          5,842     4,048     18,171    9,763     
                                                                                                                             
 Income taxes                                                                        -1,180    -812      -3,550    -1,953    
                                                                                                                             
 Profit for the period                                                               4,662     3,236     14,622    7,810     
                                                                                                                             
 Profit for the period attributable to                                                                                       
 Equity holders of the company                                                       4,662     3,236     14,622    7,810     
                                                                                                                             
 Earnings per share calculated from the profit attributable to equity holders                                                
 Earnings per share, basic (EUR)                                                     0.10      0.07      0.33      0.17      
 Earnings per share, diluted (EUR)                                                   0.10      0.07      0.32      0.17      

Statement of comprehensive income

                                        10-12/  10-12/  1-12/   1-12/  
 EUR thousand                           2020    2019    2020    2019   
                                                                       
 Profit for the period                  4,662   3,236   14,622  7,810  
                                                                       
 Comprehensive income for the period    4,662   3,236   14,622  7,810  
                                                                       
 Comprehensive income for the period                                   
 Equity holders of the company          4,662   3,236   14,622  7,810  



Statement of financial position 

 EUR thousand                         Note     31 Dec 2020  31 Dec 2019  
 Non-current assets                                                      
 Intangible assets                             835          592          
 Property, plant and equipment                 2,222        2,381        
 Right-of-use assets                  1.5      17,347       18,770       
 Equity investments                            266          266          
 Deferred tax assets                           1,349        1,195        
 Trade receivables                    1.6/1.7  3,201        1,882        
 Other non-current receivables                 425          435          
 Non-current assets, total                     25,646       25,521       
                                                                         
 Current assets                                                          
 Inventories                                   75,384       66,702       
 Trade receivables                    1.6/1.7  18,650       14,620       
 Other receivables                             1,462        1,143        
 Income tax receivables                        -            278          
 Accrued income                                9,446        9,424        
 Cash and cash equivalents            1.7      43,099       42,495       
 Current assets, total                         148,041      134,662      
                                                                         
 Total assets                                  173,687      160,183      
                                                                         
 Equity                                                                  
 Share capital                                 100          100          
 Treasury shares                               -2,206       -701         
 Invested non-restricted equity fund           25,816       25,707       
 Retained earnings                             2,217        3,647        
 Profit for the period                         14,622       7,810        
 Total equity                                  40,549       36,563       
                                                                         
 Non-current liabilities                                                 
 Lease liabilities                    1.7      18,045       19,676       
 Deferred tax liabilities                      -            7            
 Provisions                                    766          660          
 Non-current liabilities, total                18,811       20,343       
                                                                         
 Current liabilities                                                     
 Lease liabilities                    1.7      3,883        3,758        
 Advance payments received                     8,475        3,819        
 Trade payables                       1.7      70,171       73,068       
 Other current liabilities                     12,296       7,892        
 Accrued liabilities                           18,039       14,741       
 Income tax liabilities                        1,463        -            
 Current liabilities, total                    114,327      103,277      
                                                                         
 Total liabilities                             133,138      123,620      
                                                                         
 Total equity and liabilities                  173,687      160,183      



Statement of cash flows

                                                                                    1-12/    1-12/    
 EUR thousand                                                                       2020     2019     
 Cash flow from operating activities                                                                  
 Profit before income taxes                                                         18,171   9,763    
 Adjustments                                                                                          
 Depreciation and impairment                                                        5,010    5,040    
 Finance income and costs                                                           1,384    1,527    
 Other adjustments                                                                  458      476      
 Cash flow before change in working capital                                         25,025   16,806   
 Change in working capital                                                                            
 Increase (-) / decrease (+) in non-current non-interest-bearing trade receivables  -1,309   -335     
 Increase (‒) / decrease (+) in trade and other receivables                         -4,371   1,653    
 Increase (‒) / decrease (+) in inventories                                         -8,682   -918     
 Increase (+) / decrease (‒) in current liabilities                                 9,576    -3,650   
 Cash flow before financial items and taxes                                         20,239   13,557   
 Interest paid                                                                      -66      -59      
 Interest received                                                                  5        7        
 Interest of lease liabilities                                                      -1,323   -1,483   
 Income tax paid                                                                    -1,970   -2,333   
 Cash flow from operating activities                                                16,884   9,690    
                                                                                                      
 Cash flow from investing activities                                                                  
 Purchases of property, plant and equipment                                         -769     -1,016   
 Purchases of intangible assets                                                     -587     -186     
 Proceeds from equity investments                                                   -        57       
 Cash flow from investing activities                                                -1,356   -1,145   
                                                                                                      
 Cash flow from financing activities                                                                  
 Decrease (-) in lease liabilities                                                  -3,821   -3,690   
 Dividends paid                                                                     -9,597   -8,908   
 Acquisition of treasury shares                                                     -1,505   -198     
 Cash flow from financing activities                                                -14,923  -12,796  
                                                                                                      
 Increase (+) / decrease (‒) in cash and cash equivalents                           604      -4,251   
                                                                                                      
 Cash and cash equivalents at beginning of financial year                           42,495   46,746   
 Cash and cash equivalents at end of financial year                                 43,099   42,495   



Statement of changes in equity

 A Share capital                               D Fair value reserve                                    
 B Treasury shares                             E Retained earnings                                     
 C Invested non-restricted equity fund         F Total equity                                          
                                                                                                       
                                                                                                       
 EUR thousand                                  A            B            C       D    E       F        
 Equity 1 Jan 2020                             100          -701         25,707  0    11,457  36,563   
 Profit for the period                         -            -            -       -    14,622  14,622   
 Changes in fair values of equity investments  -            -            -       -    -       0        
 Comprehensive income for the period, total    -            -            -       -    14,622  14,622   
 Dividend distribution                         -            -            -       -    -9,597  -9,597   
 Acquisition of treasury shares                -            -1,505       -       -    -       -1,505   
 Disposal of treasury shares -Board fees       -            -            109     -    -       109      
 Share-based incentives                        -            -            -       -    358     358      
 Transactions with owners, total               -            -1,505       109     -    -9,239  -10,635  
 Equity 31 Dec 2020                            100          -2,206       25,816  0    16,839  40,549   
                                                                                                       
                                                                                                       
 EUR thousand                                  A            B            C       D    E       F        
 Equity 1 Jan 2019                             100          -502         25,585  -33  12,416  37,565   
 Profit for the period                         -            -            -       -    7,810   7,810    
 Changes in fair values of equity investments  -            -            -       33   -       33       
 Comprehensive income for the period, total    -            -            -       33   7,810   7,843    
 Dividend distribution                         -            -            -       -    -8,908  -8,908   
 Acquisition of treasury shares                -            -198         -       -    -       -198     
 Disposal of treasury shares -Board fees       -            -            122     -    -       122      
 Share-based incentives                        -            -            -       -    139     139      
 Transactions with owners, total               -            -198         122     0    -8,769  -8,845   
 Equity 31 Dec 2019                            100          -701         25,707  0    11,457  36,563   



Notes

1.1  Accounting principles applied in this Financial Statements Release

Verkkokauppa.com Oyj is a public limited company, the shares of which were
quoted until 4 June 2020 on the First North Growth Market of Nasdaq Helsinki
Ltd marketplace and are quoted on 5 June 2020 onwards on the official list of
Nasdaq Helsinki Ltd. The registered address of its head office is
Tyynenmerenkatu 11, Helsinki.

Verkkokauppa.com Oyj’s Financial Statements Release for January–December
2020 has been prepared in line with IAS 34, ‘Interim Financial Reporting’
and should be read in conjunction with Verkkokauppa.com Oyj’s financial
statements for 2019, published on 4 March 2020. Verkkokauppa.com Oyj has
applied the same accounting principles in the preparation of this Financial
Statements Release as in its Financial Statements for 2019.

Verkkokauppa.com Oyj has not adopted any new accounting policies during 2020
that would have a material impact on this Financial Statements Release.

The information presented in this Financial Statements Release has not been
audited. The figures are rounded, and therefore the sum of individual figures
may deviate from the aggregate amount presented. All amounts in this report
are presented in EUR thousands, unless otherwise stated.

Management judgement related to the choice and application of accounting
policies and measures following the COVID-19

The preparation of this Interim Financial Report required management to make
judgements, estimates assumptions that affect the application of accounting
principles and the reported amounts of assets and liabilities, income and
expenses. Actual results may differ from these estimates.

Since the outbreak of COVID-19 pandemic the company has started several
initiatives to secure business continuity and staff safety. The company is
monitoring and reporting on the COVID-19 situation on a frequent basis. As the
conditions surrounding the COVID-19 pandemic are constantly changing, it is
still difficult to estimate its impact on the economy, consumer demand as well
as purchase behavior, B2B sales and wholesale. Since March 2020, the company
has monitored customers’ payment behavior and the development of account
receivables on a daily basis and has managed credit limits and potential
credit losses. No significant changes have been observed in customers’
payment behavior. COVID-19 has also not had a significant effect on inventory
turnover or impairment. There have been no significant changes in the
Company’s leases or payment terms as a result of COVID-19 that would have
affected the company’s right-of-use assets or their lease liabilities. The
current strong cash position and unused RCF facilities (20.0 million euros)
will secure business continuity even under these exceptional circumstances.

1.2          Segment reporting

Verkkokauppa.com Oyj has one reportable segment. The management of
Verkkokauppa.com Oyj has exercised judgement when it has applied the
aggregation criteria to aggregate the operating segments into one reportable
segment. The customers are the same across all operating segments, which offer
the same goods and services in uniform conditions in one main market i.e.
Finland. At the core of the company’s business model is a strong integration
of webstore and retail stores, common support functions serving the entire
business as well as the volume benefits enabled by centralized business.

1.3          Revenue from contracts with customers

The revenue streams of the company consist of the sale of goods and services.
There are more than 65,000 products in 26 different main product categories
that the company sells to consumers through its own webstore and four retail
stores in Finland. The sale of services rendered by the company includes, for
example, installation and maintenance services, subscription sales and
visibility sales. Revenue is accumulated geographically mainly from Finland.

Revenue from sales of products is recognized at a point in time when the
control has been transferred. The revenue from services is recognized mainly
over time.

Disaggregation of revenue

Satisfaction of performance obligations

                     10-12/   10-12/   1-12/    1-12/    
 EUR thousand        2020     2019     2020     2019     
 At a point in time  174,554  158,266  549,062  498,343  
 Over time           1,455    1,641    4,574    5,770    
 Revenue, total      176,009  159,908  553,636  504,113  

Revenue by external customers’ location

                                          10-12/   10-12/   1-12/    1-12/    
 EUR thousand                             2020     2019     2020     2019     
 Finland                                  165,945  135,145  506,185  442,540  
 Rest of the world                        10,065   24,763   47,451   61,573   
 Revenue by external customers' location  176,009  159,908  553,636  504,113  

Income recognized from customer financing

The company presents all income from customer financing as part of revenue in
the primary financial statements.

The table below presents the income recognized from company- financed Apuraha
customer financing divided into income recognized using the effective interest
rate method and other income. Other income consists of other fees.

                                                                  10-12/  10-12/  1-12/  1-12/  
 EUR thousand                                                     2020    2019    2020   2019   
 Interest income recognized using effective interest rate method  585     346     2,034  1,293  
 Other income from company-financed customer financing            366     519     1,558  1,983  
 Income from company-financed Apuraha, total                      951     865     3,592  3,276  

1.4          Seasonality of business

The nature of the business of the company includes seasonality. Ordinary
seasonal fluctuations are reflected in cash and cash equivalents, cash flow
and accounts payable, which usually reach the highest point at year-end and
the lowest point at the end of the second quarter.

1.5          Right-of-use assets

 EUR thousand                            31 Dec 2020  31 Dec 2019  
 Carrying amount 1.1.                    18,770       21,764       
 Increases                               2,221        113          
 Increase/decrease due to remeasurement  201          700          
 Disposals                               -62          -33          
 Depreciation                            -3,783       -3,774       
 Carrying amount at the end of period    17,347       18,770       

The remeasurements made during 2019 and 2020 relate to index adjustments and
renegotiated rental agreements.

1.6          Trade receivables

                             31 Dec 2020                        31 Dec 2019                        
 EUR thousand                Trade receivables  Loss allowance  Trade receivables  Loss allowance  
 Not due                     17,964             656             12,226             101             
 Past due 1-60 days          4,878              357             4,399              331             
 Past due 61-120 days        84                 61              419                110             
 Past due over 121 days      49                 49              17                 17              
 Total                       22,975             1,123           17,061             559             

1.7          Financial assets and liabilities by measurement category

 31 Dec 2020                                                  Recognized at fair value through other comprehensive income  At amortized cost  Lease liabilities          
                                                                                                                                              
 EUR thousand                                                                                                              Carrying amount    
 Non-current financial assets                                                                                                                                            
 Equity investments (level 3)                                 266                                                          -                  -                  266     
 Trade receivables and other financial receivables            -                                                            3,626              -                  3,626   
 Non-current financial assets, total                          266                                                          3,626              -                  3,892   
                                                                                                                                                                         
 Current financial assets                                                                                                                                                
 Trade receivables                                            -                                                            18,650             -                  18,650  
 Cash and cash equivalents                                    -                                                            43,099             -                  43,099  
 Current financial assets, total                              -                                                            61,750             -                  61,750  
                                                                                                                                                                         
 Financial assets by measurement category, total              266                                                          65,375             -                  65,642  
                                                                                                                                                                         
 Non-current financial liabilities                                                                                                                                       
 Lease liabilities                                            -                                                            -                  18,045             18,045  
 Non-current financial liabilities, total                     -                                                            -                  18,045             18,045  
                                                                                                                                                                         
 Current financial liabilities                                                                                                                                           
 Lease liabilities                                            -                                                            -                  3,883              3,883   
 Trade payables                                               -                                                            70,171             -                  70,171  
 Current financial liabilities, total                         -                                                            70,171             3,883              74,054  
                                                                                                                                                                         
 Financial liabilities by measurement category, total         -                                                            70,171             21,928             92,099  
                                                                                                                                                                         
                                                                                                                                                                         
                                                                                                                                                                         
 31 Dec 2019                                                  Recognized at fair value through other comprehensive income  At amortized cost  Lease liabilities          
                                                                                                                                              
 EUR thousand                                                                                                              Carrying amount    
 Non-current financial assets                                                                                                                                            
 Equity investments (level 3)                                 266                                                          -                  -                  266     
 Trade receivables and other financial receivables (level 2)  -                                                            2,317              -                  2,317   
 Non-current financial assets, total                          266                                                          2,317              -                  2,583   
                                                                                                                                                                         
 Current financial assets                                                                                                                                                
 Trade receivables (level 2)                                  -                                                            14,620             -                  14,620  
 Cash and cash equivalents (level 2)                          -                                                            42,495             -                  42,495  
 Current financial assets, total                              -                                                            57,116             -                  57,116  
                                                                                                                                                                         
 Financial assets by measurement category, total              266                                                          59,432             -                  59,698  
                                                                                                                                                                         
 Non-current financial liabilities                                                                                                                                       
 Lease liabilities (level 2)                                  -                                                            -                  19,676             19,676  
 Non-current financial liabilities, total                     -                                                            -                  19,676             19,676  
                                                                                                                                                                         
 Current financial liabilities                                                                                                                                           
 Lease liabilities (level 2)                                  -                                                            -                  3,758              3,758   
 Trade payables (level 2)                                     -                                                            73,068             -                  73,068  
 Current financial liabilities, total                         -                                                            73,068             3,758              76,826  
                                                                                                                                                                         
 Financial liabilities by measurement category, total         -                                                            73,068             23,434             96,502  



Determining fair values

Level 1: Fair values are based on the (unadjusted) quoted prices of identical
assets or liabilities publicly traded in active markets.

Level 2: Financial instruments are not traded in active and liquid markets,
but their fair values are calculable based on market data.

Level 3: Measuring of financial instruments is not based on verifiable market
data, nor are other factors influencing the fair value of the instruments
available or verifiable.

The equity investments in level 3 contain unquoted shares. According to the
assessments of the management, measurement at cost is closest to fair value.
There have been no changes in the carrying amounts during the financial year
2020. There have been no significant transfers between measurement categories
during the review period.

1.8          Dividends

Dividends paid after the reporting period and year-on-year.

 2020                                                                     
 For the previous year          Date of payment  Dividend per share, EUR  
                                9.4.2020         0.052                    
                                6.5.2020         0.053                    
                                4.8.2020         0.054                    
                                3.11.2020        0.055                    
 Total dividends, EUR thousand                   9,597                    
 2019                                                                     
 For the previous year          Date of payment  Dividend per share, EUR  
                                8.4.2019         0.048                    
                                21.5.2019        0.049                    
                                20.8.2019        0.050                    
                                5.11.2019        0.051                    
 Total dividends, EUR thousand                   8,908                    

1.9          Transactions with related parties

Verkkokauppa.com Oyj’s related parties comprise the Board of Directors, the
CEO as well as the other members of the Management Team and the close members
of the family of said persons as well as their controlled entities.
Transactions with related parties have been carried out on usual commercial
terms. One of the company’s related parties is Board member Samuli
Seppälä, who held 40.6% of all shares and votes in Verkkokauppa.com on 31
December 2020.

 EUR thousand                                                               30 Dec 2020  31 Dec 2019  
 Sales of goods and services                                                                          
 To key management personnel and their related parties                      77           46           
                                                                                                      
 Purchases of goods and services                                                                      
 From key management personnel and their related parties                    1            -            
                                                                                                      
                                                                                                      
 EUR thousand                                                               30 Dec 2020  31 Dec 2019  
 Closing balances from purchases/sales of goods/services                                              
 Trade receivables from key management personnel and their related parties  9            7            
                                                                                                      
 Trade payables to key management personnel and their related parties       -            -            



LONG-TERM INCENTIVE PLANS

The Board of Directors of Verkkokauppa.com Oyj has on 13 February 2020
resolved to establish a new share-based incentive plan for the CEO and the
members of the Management Team. The aim of the new plan is to align the
objectives of the shareholders and the management in order to increase the
value of the company in the long term, to encourage the management to
personally invest in the company shares, to retain the members of the
Management Team at the company and to offer them a competitive reward plan
that is based on acquiring, earning and accumulating the company’s shares.

In the new Performance Matching Share Plan 2020–2022, a person may earn a
number of matching shares based on their investment in Verkkokauppa.com
Oyj’s shares and the Total Shareholder Return (TSR) of the share. The
Performance Matching Share Plan includes one performance period, calendar
years 2020–2022. The reward to be paid to participants is based on the
achievement of the required TSR levels set by the Board of Directors. A
maximum of three performance-based matching shares is paid for each allocated
share. The prerequisite for participation and receiving of reward is that a
participant allocates freely transferable company shares, held by them, in the
plan, or acquires the company’s shares up to the number determined by the
Board of Directors. Furthermore, payment of reward is based on the
participant’s valid employment or service upon reward payment. As a rule, no
reward will be paid if a participant’s employment or service ends before the
reward payment.

The target group of the plan consists of eight persons, the CEO and all other
members of the Management Team. In accordance with the terms of the plan each
participant is entitled to get a gross number of shares. However, a net number
of shares will be paid to the participant after the company has withheld and
paid the value of a part of the shares to cover the employee’s tax
obligation. The rewards to be paid on the basis of the plan correspond to the
value of approximately 540,000 Verkkokauppa.com Oyj shares in total (gross
amount).

1.10        Guarantees and commitments

 EUR thousand                                  30 Dec 2020  31 Dec 2019  
 Collateral given for own commitments                                    
 Guarantees                                    3,082        2,652        
                                                                         
 Other commitments and contingent liabilities  8            11           

Guarantees are related to rent guarantees, the comprehensive guarantee for
Finnish Customs and documentary credits. Other commitments are related to
off-balance residual values.

1.11        IFRS Standards not yet effective

There are no IFRS, IFRIC interpretations, annual improvements or amendments to
IFRS that are not yet effective that would be expected to have a material
impact on the company’s financial statements.

1.12        Subsequent events

On 4 January 2021 Verkkokauppa.com announced that Board member Mikael Hagman
had resigned from the company’s Board.

Verkkokauppa.com Oyj announced on January 27, 2021 that it has appointed Saara
Tikkanen as the company's new HR Director and member of the Management Team.

Verkkokauppa.com Oyj announced on 12 February 2021 the company's updated
strategy and long-term financial targets.

ADDITIONAL INFORMATION

Quarterly income statement

                                                                               10-12/    7-9/      4-6/      1-3/      10-12/    
 EUR thousand                                                                  2020      2020      2020      2020      2019      
                                                                                                                                 
 Revenue                                                                       176,009   129,321   123,050   125,255   159,908   
                                                                                                                                 
 Other operating income                                                        188       127       116       127       153       
 Materials and services                                                        -149,348  -108,394  -101,645  -105,835  -137,710  
 Employee benefit expenses                                                     -10,419   -8,105    -8,417    -8,619    -9,115    
 Depreciation and amortization                                                 -1,306    -1,228    -1,246    -1,230    -1,246    
 Other operating expenses                                                      -8,920    -6,116    -7,503    -6,280    -7,523    
                                                                                                                                 
 Operating profit                                                              6,203     5,606     4,356     3,418     4,467     
                                                                                                                                 
 Finance income                                                                3         5         2         2         2         
 Finance costs                                                                 -363      -339      -359      -362      -421      
                                                                                                                                 
 Profit before income taxes                                                    5,842     5,272     3,999     3,057     4,048     
                                                                                                                                 
 Income taxes                                                                  -1,180    -1,055    -701      -613      -812      
                                                                                                                                 
 Profit for the period                                                         4,662     4,218     3,298     2,444     3,236     
                                                                                                                                 
 Profit for the period attributable to                                                                                           
 Equity holders                                                                4,662     4,218     3,298     2,444     3,236     
                                                                                                                                 
 Earnings per share calculated from the profit attributable to equity holders                                                    
 Earnings per share, basic and diluted (EUR)                                   0.10      0.09      0.07      0.05      0.07      

Alternative performance measurement

In this Financial Statements Release, Verkkokauppa.com Oyj presents certain
key figures that are not accounting measures defined under IFRS and therefore
are considered as Alternative Performance Measures (APM). Verkkokauppa.com Oyj
applies in the reporting of alternative performance measures the guidelines
issued by the European Securities and Market Authority (ESMA).

Verkkokauppa.com Oyj uses alternative performance measures to reflect the
underlying business performance and to enhance comparability between financial
periods. The company’s management believes that these key figures provide
supplementing information on the income statement and financial position.

Alternative performance measures do not substitute the IFRS key ratios.

                                                                   2020                                         2019                                         
                                                                   Q1       Q2       Q3       Q4       FY 2020  Q1       Q2       Q3       Q4       FY 2019  
                                                                                                                                                             
 Revenue, thousand euros                                           125,255  123,050  129,321  176,009  553,636  115,797  107,848  120,560  159,908  504,113  
 Gross profit, thousand euros                                      19,420   21,405   20,928   26,661   88,413   17,399   15,327   18,949   22,198   73,874   
 Gross margin-%                                                    15.5%    17.4%    16.2%    15.1%    16.0%    15.0%    14.2%    15.7%    13.9%    14.7%    
 EBITDA, thousand euros                                            4,648    5,602    6,834    7,509    24,593   3,581    1,448    5,588    5,713    16,330   
 EBITDA-%                                                          3.7%     4.6%     5.3%     4.3%     4.4%     3.1%     1.3%     4.6%     3.6%     3.2%     
 Operating profit, thousand euros                                  3,418    4,356    5,606    6,203    19,583   2,301    190      4,333    4,467    11,290   
 Operating profit-%                                                2.7%     3.5%     4.3%     3.5%     3.5%     2.0%     0.2%     3.6%     2.8%     2.2%     
 Comparable operating profit, thousand euros                       3,754    4,826    5,606    6,203    20,390   2,301    190      4,333    4,467    11,290   
 Comparable operating profit-%                                     3.0%     3.9%     4.3%     3.5%     3.7%     2.0%     0.2%     3.6%     2.8%     2.2%     
 Profit for the period, thousand euros                             2,444    3,298    4,218    4,662    14,622   1,525    -154     3,203    3,236    7,810    
                                                                                                                                                             
 Interest-bearing net debt, thousand euros                         -22,339  -13,024  -14,654  -21,171  -21,171  -8,869   -895     -10,078  -19,061  -19,061  
 Investments, thousand euros                                       266      396      284      411      1,356    95       750      28       372      1,245    
                                                                                                                                                             
 Equity ratio, %                                                   24.5%    27.4%    25.9%    24.5%    24.5%    26.5%    27.7%    25.6%    23.4%    23.4%    
 Gearing, %                                                        -60.8%   -35.8%   -38.3%   -52.2%   -52.2%   -24.0%   -2.6%    -28.4%   -52.1%   -52.1%   
 Personnel at the end of period*                                   693      747      700      818      818      657      731      688      758      758      
                                                                                                                                                             
 Basic earnings per share, euros                                   0.05     0.07     0.09     0.10     0.33     0.03     0.00     0.07     0.07     0.17     
 Diluted earnings per share, euros                                 0.05     0.07     0.09     0.10     0.32     0.03     0.00     0.07     0.07     0.17     
 Number of issued shares, 1,000 pcs                                45,065   45,065   45,065   45,065   45,065   45,065   45,065   45,065   45,065   45,065   
 Number of treasury shares, 1,000 pcs                              73       353      358      353      353      57       101      91       81       81       
 Weighted average number of shares outstanding, 1,000 pcs          44,987   44,971   44,952   44,907   44,907   45,004   44,964   44,944   44,984   44,984   
 Diluted weighted average number of shares outstanding, 1,000 pcs  45,527   45,511   45,492   45,447   45,447   45,096   45,058   45,058   45,042   45,042   

*The number of personnel includes both full- and part-time employees.

Formulas for key ratios

 KEY RATIO                             DEFINITIONS                                                                                                                            BASIS OF ALTERNATIVE PERFORMANCE MEASURES ADOPTED                                                                                                                           
 GROSS PROFIT                          Revenue – materials and services                                                                                                       Gross profit shows the profitability of the sales                                                                                                                           
 GROSS MARGIN, %                       (Revenue – materials and services) / Revenue                                                                                    x 100  Gross margin measures the profitability of the sales of Verkkokauppa.com                                                                                                    
 EBITDA                                Operating profit + depreciation + amortization                                                                                         EBITDA shows the operational profitability                                                                                                                                  
 EBITDA, %                             (Operating profit + depreciation + amortization) / Revenue                                                                      x 100  EBITDA measures the operational profitability of Verkkokauppa.com                                                                                                           
 OPERATING PROFIT                      Result for the period before income taxes and net finance income and costs                                                             Operating profit shows result generated by operating activities                                                                                                             
 OPERATING MARGIN, %                   Operating profit / Revenue                                                                                                      x 100  Operating margin measures operational efficiency of Verkkokauppa.com                                                                                                        
 ITEMS AFFECTING COMPARABILITY         Material items which are not part of normal operating activities such as expenses related to possible transfer to official list                                                                                                                                                                                    
                                       of Nasdaq Helsinki, restructuring costs including workforce redundancy and other restructuring costs, impairment losses of fixed                                                                                                                                                                                    
                                       assets, gain or losses recognized from disposals of fixed assets/businesses, transaction costs related to business acquisition,                                                                                                                                                                                    
                                       compensations for damages and legal proceedings                                                                                                                                                                                                                                                                    
 COMPARABLE OPERATING PROFIT           Comparable operating profit is profit adjusted with items affecting comparability                                                      Comparable operating profit allows comparison of operating profit in different periods without the impact of extraordinary items not related to normal business operations  
 COMPARABLE OPERATING PROFIT MARGIN %  Comparable operating profit / revenue                                                                                           x 100  Comparable operating margin measures comparable operational efficiency of Verkkokauppa.com                                                                                  
 EQUITY RATIO, %                       Total equity / Balance sheet total – advance payments received                                                                         Equity ratio measures Verkkokauppa.com’s solvency, ability to bear losses and ability to meet commitments in the long run                                                   
 INTEREST-BEARING NET BEDT             Lease liabilities -cash and cash equivalents                                                                                           Interest-bearing net debt measures Verkkokauppa.com’s indebtedness                                                                                                          
 GEARING, %                            Lease liabilities – cash and cash equivalents/ Total equity                                                                     x 100  Gearing measures the relation of equity and interest-bearing net debt of Verkkokauppa.com and shows the indebtedness of the company                                         
 INVESTMENTS                           Increases in intangible assets, property, plant and equipment during the financial period                                              Investments provides additional information regarding operating cash flow demands                                                                                           
 NET INVESTMENT                        Investments in intangible and tangible assets - proceeds from the sale of fixed assets. Net investments do not include non                                                                                                                                                                                         
                                       -capitalized / work in progress                                                                                                                                                                                                                                                                                    
 EARNINGS PER SHARE, BASIC             Profit for the period attributable to equity holders of the company / Weighted average number of shares outstanding                    Earnings per shares measures the profit for the period attributable to equity holders of the company                                                                        
 EARNINGS PER SHARE, DILUTED           Profit for the period attributable to equity holders of the company / Weighted average number of shares outstanding + dilutive                                                                                                                                                                                     
                                       potential shares                                                                                                                                                                                                                                                                                                   

Reconciliation of alternative key ratios

                                                                           10-12/  10-12/  1-12/   1-12/   
 EUR thousand                                                              2020    2019    2020    2019    
 Operating profit                                                          6,203   4,467   19,583  11,290  
 - advisory costs related to transfer to official list of Nasdaq Helsinki  -       -       807     -       
 Comparable operating profit                                               6,203   4,467   20,390  11,290  



Attachment
*     Verkkokauppa.com Oyj Financial Statements Release 2020 published
(https://ml-eu.globenewswire.com/Resource/Download/7142bd55-b2ff-4577-be8b-0ff8165912a0)
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