Tallinna Kaubamaja AS : Sales results for the 12 months and the 4th quarter of 2011

Tallinna Kaubamaja
Company Announcement Sales results for the 12 months and the 4th quarter of 2011

The consolidated unaudited sales revenue of the Tallinna Kaubamaja Group in the 12 months of 2011 was 436.0 million euros, having grown by 5.6% compared to the result of the 12 months of 2010, when the sales revenue was 412.7 million euros. In the 4th quarter, the sales revenue of the Group was 119.5 million euros, exceeding the sales revenue of a year before by 6.3%. The reference base was influenced by the sales tax, levied in Tallinn since June 2010, which decreased the sales revenue of the Group earned in the 12 months of 2011 by 2.1 million euros (by 1.2 million euros in the 12 months of 2010). As of 01.01.2011, the principles for calculating the sales revenue of the Group changed and the reference data of 2010 have been adapted to the new principles. As a result, an additional 9.9 million euros have been recorded in the sales revenue of the 12 months of 2010.

The consolidated sales revenue and the sales revenue in Estonia in the business segment of supermarkets was 317.9 million euros in the 12 months of 2011, having grown by 2.9% compared to the same period of the previous year. The consolidated sales revenue and the sales revenue in Estonia in the 4th quarter was 83.0 million euros, having grown by 1.8% compared to the same period of the previous year. The month's average sales revenue of goods per one square metre of selling space in  2011 was 0.37 thousand euros, having grown compared to 2010 by 3.2% in the consolidated view and by 2.8% in the view of the Estonian market. In the 4th quarter, the sales revenue per one square metre of selling space was 0.39 thousand euros, thus showing an increase of 2.8% in both consolidated data and the Estonian market. The sales revenue of goods per one square metre of selling space in the comparable stores was an average of 0.38 thousand euros in  2011 and 0.40 thousand euros in the 4th quarter, thus displaying an increase of 3.7% and 3.8%, respectively. In the Selver stores located in Estonia, 33.1 million purchases were made in 2011, which is 0.6% lower than the number of purchases made a year before. The increase in the sales revenue of Selver's goods in these 12 months mainly occurred due to the continuously successful sales campaigns, as well as sales campaigns carried out in accordance with the target customers' expectations, and the successful sales of the holiday period in December. In addition, continuous work was done to adjust the selection of goods to comply with the changes in demand and to ensure the availability of goods. The sales revenue of goods is influenced by the overall increase in the price of food products that has occurred in Estonia, resulting in a decrease of sales volumes all over the country as well as in Selver stores. Since October, the rise in consumer prices has slowed down and an increase in sales volumes is noticeable. Compared to the previous year, the growth of the sales revenue has been negatively affected by the continued tight competition on the retail market and the levy of the sales tax in Tallinn. In addition, negative influence on the sales revenue was brought about by the closing of renovated stores for 2-4 weeks in order to perform renovation works. In 2011, Selver renovated four of its stores: Kadaka in Tallinn, Mai in Pärnu, Männimäe in Viljandi and Vilja in Võru. The new Kadaka Selver was opened in April, while the other stores were renovated in the 4th quarter. A new sales space concept provided guidelines for renovating the stores. In July, Selver closed one store in Narva due to unsatisfactory profitability - the Soldino Selver. At the moment, Selver is continuing business in Narva with one store. Due to the closing of Latvian stores, there was no sales revenue of goods in Latvia during 2011. The entire sales revenue of Selver in Latvia was 1.7 thousand euros in 2011 and 31.5 thousand euros in 2010. At the end of the year 2011, the Selver chain included 34 stores and a central kitchen. Selver has plans to open several new stores in 2012. The first is going to be the Saku Selver opened in May - food products will be focussed on in its 1,764 m2 of sales space.

In 2011, the sales revenue of the business segment of department stores was 80.5 million euros, having increased by 7.9% compared to the previous year. Of that, the sales revenue of the 4th quarter was 25.3 million euros, which was 11.6% higher than the sales revenue of the 4th quarter of 2010. The sales revenue of the 4th quarter was positively influenced by the successful Osturalli campaign and the final campaign of the sports section, which began in November. The average monthly sales revenue of Kaubamaja per one square metre of selling space in 2011 was 0.26 thousand euros - 8.3% more than the average sales revenue of 2010. In August, the selling space of Kaubamaja diminished by 525 m2, as the youth department of Kaubamaja was closed at the end of July. In 2011, the sales revenue of OÜ TKM Beauty Eesti, which operates the I.L.U. beauty stores, was 3.2 million euros, having grown by 43.2% compared to the same period of the previous year. Of that, the sales revenue of the 4th quarter was 1.2 million euros, 45.7% higher than the corresponding period of 2010. Compared to the previous year, in September 2010 the I.L.U. chain opened a fourth store in Tallinn in the Kristiine Centre and a fifth store has been open in the Ülemiste Centre in Tallinn since April. 

The external sales revenue of the real estate business segment for the 12 months of 2011 was 2.8 million euros, having increased by 1.1% compared to the 12 months of the previous year. The sales revenue of the 4th quarter of the accounting year was 0.7 million euros, which is 6.7% more than the result of the 4th quarter of 2010.

The sales revenue of the vehicle segment for the 12 months of 2011 without inter-segment transactions was 20.8 million euros, thus exceeding the sales revenue of the same period of the previous year by 60.9%. The sales revenue of 6.6 million euros earned in the 4th quarter exceeded the sales revenue of a year earlier by 89%.

The turnover for the footwear segment in the 12 months of 2011 was 14.0 million euros, having grown by 3.9% in a year. In the 4th quarter, the turnover was 4.0 million euros, which means a decrease of 2.9% compared to the same period of 2010. The sales results of the footwear segment in the 4th quarter were affected by the closing of ineffective stores (compared to the 4th quarter of 2010, the number of stores was smaller by 3; the sales growth of comparable stores was 2.5%), the closing of the store in the Pärnu Kaubamajakas for 3 weeks in connection with the concept change, and disadvantageous weather, which hindered the sales of winter boots. In the beginning of December, the first Shu store in Pärnu was opened in the Pärnu Kaubamajakas on the area thus far rented by ABC King. There are plans to reopen the ABC King store in the Kaubamajakas in the 2nd quarter of 2012. As of the end of December, Suurtüki NK OÜ owns 14 stores in Estonia, ABC King AS owns 9 stores in Estonia and ABC King SIA owns 3 stores in Latvia.

 Raul Puusepp
 Chairman of the board
 Phone [phone]