Harvia provides additional financial information on the acquisition of the business operations of Almost Heaven Saunas LLC

Stock Exchange Release | 21 December 2018


Almost Heaven Saunas is one of the leading sauna and spa product companies in the United States. The acquisition will enable Harvia to offer better and more extensive service to Harvia's customers in North America.

With reference to the stock exchange release of December 21, 2018, Harvia is providing additional financial information on the acquisition of the business operations of Almost Heaven Saunas LLC. Almost Heaven Saunas was established in 1978 and has been owned by its current owner since 2007. The company has grown rapidly in recent years, its revenue totaling USD 3.5 million in 2014 and approximately USD 9 million in 2017. The company's main products comprise of United States manufactured outdoor and indoor saunas of entry price range.Harvia's revenue from North America in 2017 totaled approximately EUR 3 million, of which coming about half through Almost Heaven Saunas.

Almost Heaven Saunas' rapid growth has taken place at the expense of profitability, and the earnings before interests, taxes, depreciations and amortizations (EBITDA) have been somewhat negative for the last two years (2017 and 2018).  Measures for improving profitability will be begin immediately after the transaction has been completed. Key measures include discontinuing unprofitable products, renewing the product portfolio and developing procurement.

Adjusted key figures of the acquired business:

  • Revenue 2017 = USD 8.7 million
  • Revenue 2016 = USD 6.4 million
  • Earnings before interests, taxes, depreciations and amortization (EBITDA) 2017 = USD -0.2 million (-2.4% of revenues)
  • Earnings before interests, taxes, depreciations and amortization (EBITDA) 2016 = USD +0.1 million (+1.1% of revenues)
  • Earnings before interests and taxes (EBIT) 2017 = USD -0,3 million (-3.5% of revenues)
  • Earnings before interests and taxes (EBIT) 2016 = USD +0,0 million (+0.4% of revenues)

Net value of the assets transferring in the deal is approximately USD 3.2 million, divided as follows:

  • Trade receivables = USD 0.3 million
  • Inventory = USD 1.1 million
  • Fixed assets = USD 0.5 million
  • Other assets = USD 0.2 million
  • Intangible assets (IFRS) = USD 1.1 million

Purchase price, approximately USD 4.6 million (approximately EUR 4 million) is divided as follows:

  • Payable at closing, approx. USD 1.5 million
  • Transfer of financial liabilities to the buyer, approx. USD 3.1 million
  • Approximately USD 2.7 million of the transferring financial liabilities are trade payables or other business-related non-interest-bearing liabilities.
  • After the closing, USD 0.4 million of interest bearing liabilities will be transferred to the buyer.

Harvia will finance the purchase price paid in connection with the closing out of its cash reserves, and will not raise new interest bearing debt to finance the transaction.

Harvia has established two wholly owned subsidiaries in the USA, Harvia US Holdings Inc. and its subsidiary Harvia US Inc. Harvia's subsidiary Harvia US Inc. is the entity purchasing the business and will continue its operations. Almost Heaven Saunas' business, customer base, trademarks and technologies will be transferred to Harvia. The transaction will generate goodwill in the amount of approximately USD 1.4 million, and the amortization of acquired intangible assets will amount to approx. USD 0.2 million annually.

The organization, which will come with the acquired business, as well as the production facilities and warehouses, which are rented in West Virginia, USA, will enable Harvia a wider and quicker distribution of its products to other customers and in other product segments. Almost Heaven Saunas has primarily been selling lower-price sauna cabins and heaters so far. This acquisition will support Harvia's growth strategy in North America.

Additional information

Tapio Pajuharju, CEO, Tel: +358 50 577 4200

Ari Vesterinen, CFO, Tel: +358 40 505 0440

Harvia in short

Harvia is one of the leading companies operating in the sauna and spa market globally, as measured by revenue. Harvia's brands and product portfolio are well-known in the market and the company's comprehensive product portfolio strives to meet the needs of the international sauna and spa market of both private and professional customers.

Harvia's revenue totaled EUR 60.1 million in 2017, its operating profit was EUR 9.3 million and adjusted operating profit EUR 10.7 million during the same period. The company employs some 365 professionals in Finland, China and Hong Kong, Romania, Austria, Germany and Estonia. The company is headquartered in Muurame, Finland, adjacent to its largest sauna and sauna component manufacturing facility.